Mo. Code Regs. tit. 11 § 45-5.240
Current through Register Vol. 49, No.12, June 17, 2024
Section 11 CSR 45-5.240 - Periodic PaymentsPURPOSE: This amendment updates the class designation and removes duplicative language that is already addressed in 11 CSR 45-1.100.
(1) Except as provided in this rule, a holder of a Class B license shall remit the total winnings and noncash prizes awarded to a patron as the result of any licensed game, tournament, contest, or promotional activity upon validation of the win.(2) For the purpose of this rule, the following words have the following meanings: (A) Independent financial institution means- 1. A financial institution licensed by Missouri or a national institution with an office in Missouri; or2. An insurance company admitted to transact insurance in Missouri with an A.M. Best Insurance rating of A or another equivalent rating; and3. One which is not affiliated through common ownership with a gaming licensee;(B) Periodic payments means a series of payments that are paid at least annually; and(C) Trust means an irrevocable fiduciary relationship in which one (1) person is the holder of the title to property subject to an equitable obligation to keep or use the property for the benefit of another.(3) Periodic payments of winnings and non-cash prizes awarded to a patron as a result of any licensed game, tournament, contest or promotional activity may be made if the method of funding the periodic payments provides these payments to a winning patron by establishing- (A) An irrevocable surety bond or an irrevocable letter of credit with an independent financial institution which provides periodic payments to a winner should the licensee default for any reason. The written agreement establishing an irrevocable surety bond or the irrevocable letter of credit shall be submitted to the commission for approval;(B) An irrevocable trust with an independent financial institution in accordance with a written trust agreement approved by the commission, which provides periodic payments from an unallocated pool of assets to winning patrons which must expressly prohibit the winners from encumbering, assigning or otherwise transferring in any way their rights to receive the deferred portion of the winnings except to their estates. The assets of the trust must consist of federal government securities including, but not limited to, treasury bills, treasury bonds, savings bonds or other federally guaranteed securities in an amount sufficient to meet the periodic payment(s) as required; or(C) Another irrevocable method of providing the periodic payments to a winning patron consistent with the purpose of this rule and which is approved by the commission.(4) The funding of the periodic payments must be completed within thirty (30) days of the date the patron wins or is awarded a prize.(5) Periodic payments must not be used for winnings of or noncash prizes worth one hundred thousand dollars ($100,000) or less. Periodic payments for total amounts won greater than one hundred thousand dollars ($100,000) shall be paid as follows: (A) For amounts won greater than one hundred thousand dollars ($100,000), but less than two hundred thousand dollars ($200,000), payments must be at least ten thousand dollars ($10,000) annually;(B) For amounts won of two hundred thousand dollars ($200,000) or more, payments must be no less than one-twentieth (1/20) of the total amount annually; and(C) The first payment must be made upon validation of the win.(6) Periodic payments of noncash prizes may only be offered if the patron shall have the right to elect whether to receive the noncash prize or cash equivalent of the noncash prize each time a periodic payment is to be made. The cash equivalent shall be the actual cost to the licensee of the noncash prize on the day the prize is won. The amount of the periodic payments to be funded shall be determined by the present value of the cash equivalent of the noncash prize.(7) For any licensed game, tournament, contest or promotional activity for which periodic payments are utilized, the licensee must display signs on each gaming device or, if no gaming device is used, then the licensee must display signs in each gaming, promotional, tournament or contest area specifically setting forth either the amount or terms of the payment to be made each time a periodic payment is to be made. The licensee must include in all radio, television or print advertising regarding the activities set forth in this section, the fact that periodic payments are utilized for total amounts offered as a prize to a patron.(8) Whenever there is an award of winnings to be made by periodic payments, and the Class B licensee fails to fund the periodic payments as required by this rule, the licensee shall immediately notify the commission in writing and shall immediately cease offering any licensed game, tournament, contest, or promotional activity for which periodic payments are utilized. AUTHORITY: sections 313.004, 313.800 and 313.805, RSMo 1994.* Emergency rule filed Sept. 1, 1993, effective Sept. 20, 1993, expired Jan. 17, 1994. Emergency rule filed Jan. 5, 1994, effective Jan. 18, 1994, expired Jan. 30, 1994. Original rule filed Sept. 1, 1993, effective Jan. 31, 1994. Amended: Filed May 13, 1998, effective Oct. 30, 1998. Amended by Missouri Register January 2, 2024/volume 49, Number 01, effective 2/29/2024.*Original authority: 313.004, RSMo 1993, amended 1994; 313.800, RSMo 1991, amended 1993, 1994; and 313.805, RSMo 1991, amended 1993, 1994.