A Clever Marketing Campaign or Illegal Gambling? What you need to know...
Any small business owner knows that the key to success is reaching as many potential customers in the most efficient and cost effective manner possible. There are many ways to advertise, whether through television, direct mailings, print ads, or flashy promotions. What many businesses fail to realize, however, is that some promotions truly are “too good to be true.” Knowing the difference between a legal sweepstakes for promotional purposes and illegal gambling operations can be the difference between a needed boost in sales and fines, penalties or even criminal prosecution.
Florida’s Game Promotion Law
Florida law limits the use of sweepstakes by mandating that they only be used by for-profit commercial entities on a “limited and occasional basis.” While this may seem clear, the pitfall that many companies find themselves facing is that the law does not provide any indication of what is considered limited or occasional. It is argued that this most recent legislation targeting illegal gambling rings posing as legitimate business marketing was written broadly on purpose in an effort to “crack down” on establishments engaging in sweepstakes gaming for the sake of the game itself.
Not for profit gaming
The focus of Florida’s gaming laws are not limited to businesses, as not-for-profit organizations are also scrutinized whenever a “big win” is involved. Take, for example, the 50/50 raffle trend that is skyrocketing in popularity at sporting events. Fans who purchase a raffle ticket for a nominal fee have the chance to win over $20,000 while an equal amount is given to a lucky chosen charity. This type of “gaming” is legal as Florida law allows such raffles so long as they are offered by “tax-exempt, charitable” organizations. In the case of sports teams, while the teams themselves do not qualify, many of them create organizations such as the “Jaguar Foundation,” the “Miami Dolphin Foundation,” and the “Buccaneers Care Foundation.”
Violations/Penalties
Businesses who violate Florida’s laws with regard to illegal gambling face fines, misdemeanors and could face charges of deceptive and unfair trade practices. In order to ensure that an otherwise legal and potentially successful marketing campaign does not run afoul of these laws, it is essential for businesses to know how to run these in accordance with the law. From disclosure and advertising to ticket distribution and the awarding of prizes, a successful marketing campaign that draws in consumers by offering the chance of winning something with little to no consideration can have a huge impact on a company’s bottom line. The publicity of these promotions, if done correctly, can be sufficient for a long-lasting boost in profits.
If you or someone you know owns a business and has questions about Florida’s laws pertaining to marketing, advertising and promotional sweepstakes, call the Boca Raton professionals at Padula Hodkin, PLLC. Our seasoned attorneys can answer your questions and guide you to the best path forward for your company.
