Illegal Gambling in New York
New York imposes serious criminal consequences for anyone who unlawfully operates or runs a gambling ring, a gambling house, a lottery, or a similar enterprise. At the same time, the line between legal and illegal gambling can be murky at times.
Certain organizations are authorized to hold lotteries and other gambling activities, and merely participating in a gambling activity as a player is not a crime.
Three (3) Ways to Commit a Gambling Offense in New York
There are three primary ways that one can commit an illegal gambling offense in New York:
- promoting unlawful gambling,
- possessing gambling records, and
- possessing gambling devices or equipment.
Examples of situations where charges of illegal gambling offenses may be filed:
Kate illegally runs a monthly lottery in her neighborhood and receives a share of the profits.
- Kate owns a business which allows people to bet on the outcome of sporting events.
- Kate possesses gambling records in the form of bets or numbers for her gambling ring.
- Kate actively promotes and solicits gamblers to join in her next lottery.
- Kate possesses slot machines and other devices that she knows are or will be used for illegal gambling.
- Kate owns a building where she knows illegal gambling is taking place but does not do anything to stop or prevent that activity.
If you believe that you might be charged with an illegal gambling offense in New York, you should seek legal counsel immediately. Illegal gambling laws in New York are as complex as they come in the criminal law, and you may be entitled to defenses and other protections that only an experienced lawyer can successfully raise.
Statutes Defining Illegal Gambling in New York
There are three main categories of illegal gambling offenses.
The first category is “promotion of gambling.”
- NY Penal Law § 225.05 – Promoting Gambling in the Second Degree: This occurs when a person knowingly supports, aids, or profits from unlawful gambling activity. This is a class A misdemeanor.
- NY Penal Law § 225.10 – Promoting Gambling in the First Degree: This occurs when a person knowingly supports, aids, or profits from unlawful gambling activity by —
- Runs a business which takes bets from members of the public and receives, in any one day, five bets totaling more than $5,000, or
- Runs a lottery or similar gambling scheme and (1) receives money or gambling records that do not represent a player’s chances of winning, or (2) receives more than $500 in any one day. This is a class E felony.
The second category is “possession of gambling records.”
- NY Penal Law § 225.15 – Possession of Gambling Records in the Second Degree: This occurs when a person possesses any writings, papers, or records commonly used in illegal gambling. These records include nitrocellulose paper (also known as “flash paper”) and paper that is water-soluble. This is a class A misdemeanor.
- NY Penal Law § 225.20 – Possession of Gambling Records in the First Degree: This occurs when a person possesses any writings, papers, or records commonly used in illegal gambling, which represent more than five bets totaling $5,000, or reflects 500 or more plays or chances in a lottery or similar gambling scheme. This is a class E felony.
Finally, the third category is “possession of gambling devices.”
- NY Penal Law § 225.30 – Possession of a Gambling Device: This occurs when a person manufactures, sells, exchanges, transports, or possesses a gambling device. The devices can range from a slot machine to a coin-operated gambling device, or any other device the person believes will be used for gambling. This is a class A misdemeanor.
There are also other forms of gambling-related crimes, such as gambling fraud, which are discussed below.
The Elements of Illegal Gambling Offenses
The “elements” of an offense are the things that the prosecutor must prove in order for you to be found guilty of this offense.
The Elements for Promotion of Gambling
For a defendant to be convicted of promoting gambling in the second degree, all of the following must be proven at trial:
- You must have knowledge of the gambling-related activity, AND;
- You must aid or assist unlawful gambling activity, OR;
- You must profit from unlawful gambling activity.
In addition to the above, the offense will be bumped up to the first-degree promotion of gambling if the following is also proven at trial:
- You must operate a business or enterprise which receives bets from the public and receive more than five bets totaling $5,000 or more, OR;
- You must run a lottery or similar gambling scheme, and receive money or gambling records that do not represent a player’s chances of winning or more than $500 of money played in any one day.
The Elements of Possession of Gambling Records
For a defendant to be convicted of possession of gambling records in the second degree, all of the following must be proven at trial:
- You must have knowledge of the gambling-related content of the writings, papers, or other records, AND;
- You must possess writings, papers, and other records commonly used in gambling, which are not limited to nitrocellulose or flash paper and water-soluble paper.
In addition to the above, the offense will be bumped up to first-degree possession of gambling records if the following is also proven at trial:
- The gambling records represent more than five bets totaling over $5,000, OR;
- The gambling records represent more than 500 plays or chances in a lottery or similar scheme.
The Elements of Possession of a Gambling Device
For a defendant to be convicted of possession of a gambling device, all of the following must be proven at trial:
- You must have knowledge of the gambling-related character of the device, AND;
- You must manufacture, possess, sell, exchange, or transport the device, AND;
- The device is a slot machine, coin-operated gambling device, or any other device which you believe is being used or will be used in unlawful gambling.
Some of the key elements are discussed below.
Element #1: Aid or Assist Unlawful Gambling Activity
A wide range of activity is considered in aid or assistance of unlawful gambling activity. These activities include (1) creating or operating a gambling game, contest, or lottery, (2) maintaining a premise or location where the gambling activity takes place, (3) finding and soliciting players.
However, it should be noted that merely participating in gambling, game, or lottery does not satisfy this element. Additionally, casually gambling may not be enough to meet this element.
In Watts v. Malatesta, 262 N.Y. 80 (1933), the New York Court of Appeals held that casual betting or gaming by individuals, as distinguished from betting or gambling as a business or profession, is not a crime. Some examples include:
- Kate owns a bar where bar patrons play high-stakes blackjack every night.
- Kate solicits players for her friends’ sports betting ring.
Element #2: Profit from Unlawful Gambling Activity
If you receive money not as a player, but from other players seeking to participate in gambling activity, you have satisfied this element. You may also satisfy this element if you receive money that does not represent a player’s chances of winning.
Some examples include:
- Kate receives a $10 fee for anyone who wants to play in her game of blackjack.
- Kate enters into an agreement where she receives a percentage of the lottery pot.
Element #3: Possess Gambling Records
This element is satisfied if you possess any records that indicate your chances or “plays” in a game of chance or gambling scheme. Very important to note is that this element can be an exception to the general rule that a mere player or participant cannot be found to have committed an illegal gambling offense.
In fact, simply possessing these records with knowledge of their gambling-related content, even if they are your own records, can satisfy this element under N.Y. Penal Law § 225.15(2), the fact that the records are your own is a defense only up to ten of such records. If you own more than ten, you may be found to have committed this offense.
Possession of any gambling records is presumptive evidence that you know of the record’s gambling-related character or content. Some examples include:
- Kate possesses various lottery tickets. Her possession of the tickets is presumptive evidence that she knows that they are gambling-related records.
- Kate keeps a book indicating all the tickets purchased for all participants in the lottery.
- Kate owns 11 lottery tickets which she bought for herself.
Element #4: Manufacture, Possess, Sell, Exchange, or Transport a Gambling Device
“Possession of a gambling device” is a misleading title, because, as discussed above, it is very broadly defined to include the manufacture, possession, sale, exchange, and transport of a gambling device. Additionally, the device can be any device that you believe will be used for gambling.
Therefore, if the prosecution can prove that a dartboard is being used for gambling and that you know or believe that to be true, then manufacturing, possessing, selling, exchanging, or transporting that dartboard will satisfy this element. Possession of a gambling device is presumptive evidence that you know of the device’s character or content.
Some examples include:
- Kate possesses a slot machine in her garage. Her possession of the machine is presumptive evidence that she knows of its character or content.
- Kate constructs a bingo cage that she knows will be used for unlawful gambling.
Related Gambling Offenses
There are other gambling offenses that might be charged together with the above-mentioned crimes. They are:
- Attempt or conspiracy to commit illegal gambling
- NY Penal Law § 225.95 – Unlawful Manufacture, Sale, Distribution, Marking, Altering or Modification of Equipment and Devices Associated with Gaming: This offense is committed when someone unlawfully manufactures, modifies, alters, sells, or distributes any devices that are intended to be used to violate gambling laws.
Therefore, this law is slightly narrower than the “possession of a gambling device” discussed above, because you must know or should have reasonably known that the device is intended for an unlawful purpose.
- Promoting gambling in the second degree is a class A misdemeanor, with a maximum sentence of a year and a maximum fine of $1,000.
- Promoting gambling in the first degree is a class E felony, with a maximum sentence of 4 years, and a maximum fine of $5,000 or double the amount of the defendant’s gain from the crime, whichever is higher.
- Possession of gambling records in the second degree is a class A misdemeanor, with a maximum sentence of a year and a maximum fine of $1,000.
- Possession of gambling records in the first degree is a class E felony, with a maximum sentence of 4 years, and a maximum fine of $5,000 or double the amount of the defendant’s gain from the crime, whichever is higher.
- Possession of a gambling device is a class A misdemeanor, with a maximum sentence of a year and a maximum fine of $1,000.
Your sentence can significantly increase if you have a prior felony conviction. For example, if you are found guilty of first-degree promotion of gambling, a class E felony, someone with no prior felony offense could receive no jail time. However, a second felony offender will receive at least an 18-month sentence.
Under New York’s three-strikes law, someone with two prior felony convictions will face at least a 15-year sentence for the same offense.
A felony conviction also has various other collateral consequences.
- Reputational harm and loss of job
- Time and money spent defending yourself in court
- Loss of gun ownership rights
- Potential deportation if you are an immigrant
- Inability to obtain job-related licenses and certifications.
- An increased sentence for future convictions
Navigating the relevant sentencing rules is extremely consequential. You should retain and consult with an attorney as soon as possible to understand your sentencing risk should you be found guilty of an offense.
Legal Defenses to Illegal Gambling
There are several powerful defenses that a skilled attorney can use to minimize your risk and win an acquittal.
Defense #1: Lack of criminal knowledge
Each of the above-mentioned gambling offenses has some knowledge element. This means that the prosecution must prove that you knew or should have known the criminal nature of your actions. However, in many instances, you might have inadvertently committed the offense.
Nonetheless, prevailing on this defense may be difficult, as a presumption of criminal knowledge often attaches from your offense conduct. Accordingly, a skilled defense attorney is necessary to present the strongest form of this defense at your trial.
Defense #2: The gambling activity was casual
As discussed in the Watts v. Malatesta case, a casual game or bet amongst friends is likely not a criminal offense. If you have evidence that your “game” was just a casual, occasional bet and nothing more, you may be entitled to an acquittal. However, illegal gambling, even if it occurs only once, will constitute an offense.
Defense #3: You are a player or participant
For the promotion of gambling offense, you cannot be found liable if you are merely a player or participant in the game or gambling activity. You will be more likely to demonstrate that you are just a “player” if you can show that you did not receive, or were not entitled to receive, any of the profits or proceeds from the gambling enterprise.
Defense #4: Statutory defenses to possession offenses
There are two statutory defenses to the possession offenses:
- First, possession of gambling records is not a crime if the records in possession were not intended and in fact never used for gambling.
- Second, possession of a gambling device is not a crime if the device (1) is an antique and not intended for gambling, (2) is manufactured for transportation outside the state where gambling or the use of the device is legal, (3) is not intended to be used for illegal gambling, is over 30-years old, and is possessed inside the defendant’s home.
Call Us For Help.
As this article suggests, illegal gambling offenses are complex and can have serious consequences. For questions about these offenses, or to discuss your case confidentially with one of our criminal defense attorneys, do not hesitate to contact us.
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