La. Admin. Code tit. 42 § VII-705

Current through Register Vol. 50, No. 11, November 20, 2024

Section VII-705 - Funds; Segregation of Funds

A. Licensees shall:

1. segregate fantasy sports contest player funds from operational funds in accordance with R.S. 27:308(A)(9); or

2. maintain a reserve in the form of cash, cash equivalents, payment processor reserves, payment processor receivables, an irrevocable letter of credit, a bond, or a combination of these sources that is at least equal to the amount of money deposited in fantasy sports contest player accounts.

B. Licensees may satisfy the requirements of Subsection A by establishing a special purpose segregated account that is maintained and controlled by a properly constituted corporate entity that has a governing board that includes one or more independent corporate directors. The corporate entity must require a unanimous vote of all corporate directors to file bankruptcy and must have articles of incorporation that prohibit commingling of funds with those of the fantasy sports contest operator, except as necessary to reconcile the accounts.

1. Licensees shall provide the division with any and all information and documentation regarding its special purpose segregated account and shall receive approval of such account by the division prior to the implementation of such.

C. Licensees shall provide the division with documentation of the amount of deposits in Louisiana players accounts and the amount in cash reserves as of the last day of each month by the tenth day of the following month.

D. Licensees shall continuously monitor and maintain a record of all player deposits and its cash reserves to ensure compliance with the cash reserves requirement. If at any time the licensees total available cash and cash equivalent reserve is less than the amount required, the licensee shall notify the division within 48 hours of the deficiency, the reason, and the resolution to correct the deficiency.

E. Licensees shall prohibit a player from transferring funds through his account or the platform to any other player.

F. Except as provided in subsection (E), licensees shall allow a player to withdraw the funds maintained in his account within five business days of the request being made. For purposes of this Paragraph, a request for withdrawal is considered honored if it is processed by the licensee but delayed by a payment processor, credit card issuer, or by the custodian of a financial account through no fault, action or inaction of the licensee.

G. A licensee may decline to honor a players request to withdraw funds only if the licensee believes in good faith that the player engaged in fraudulent conduct or other conduct that would put the licensee in violation of the Act or these regulations. In such cases, the licensee may withhold the funds for a reasonable investigatory period until the investigation is resolved, if the licensee provides notice of the nature of the investigation to the player and conducts its investigation in a reasonable and expedient fashion providing the player additional written notice of the status of the investigation every tenth business day starting from the day the original notice was provided to the player.

La. Admin. Code tit. 42, § VII-705

Promulgated by the Department of Public Safety and Corrections, Gaming Control Board, LR 47267 (2/1/2021).

AUTHORITY NOTE: Promulgated in accordance with R.S. 27:15, 24, and 304.