Tyree Collier Interviewed in Nonprofit Times on Online Raffles

“Online Raffles Are Chancy, At Best”

Online raffles might seem like lower-effort fundraising alternatives to web-based auctions, but even these have their hazards. Raffles, unlike sweepstakes, require some sort of consideration in exchange for a chance to win. Thus, gambling statutes often regulate such events.

How can an organization lessen the likelihood of running afoul of these statutes, which can vary not just state-by-state, but county-by-county? “What I expect charities to do is not consummate transactions online,” said Tyree Collier, an attorney at the firm Thompson and Knight in Dallas, Texas.

According to Collier, even organizations where managers try to keep online raffles in-state to limit compliance issues could run afoul of the law. Texas, for example, does not permit statewide raffles. Organizations have attempted to get around this by blocking residents in a few of the least-populous ZIP codes, Collier said.