Q#1-If we offer a chance win a prize to the general public, with no exchange of money or requirement to open an account-they would have to come in the door and register-but that's it,am I correct in assuming this is not a lottery (as far as bank rules-I realize state law may still come into play.

Q#2-The community paper has an advertising gimic, wherein the business (the bank) pays $45 a week for six weeks to have its name included in an ad, which advertises "these sponsors are offering you a chance to win $100-just go to the business and register". There is no purchase necessary-not even of the paper as the paper is distributed freely to the community. Again-I assume this is OK and not a lottery as no money other than for payment of the ad to the paper is taking place.

Running gun shy-thanks.

#1: I agree this is not a "lottery" since they don't have to advance money for a chance to win.

#2: If the customer doesn't have to pay anything, I agree.

Biz:

You really need to check your state laws on these questions and I would also check with your local DA's office and even your state attorney general's office.

I have found in the past that it pays to do so as you will talk to the officials who will sue you if it turns out your are involved in a lottery and you will find out from the "source" exactly what you can do and can't do.

Many years ago, I contacted the consumer fraud unit of the Vermont AG's office to verify that a local branch "contest" that involved having existing customers drop their name in a bowl for a free lunch if they brought a non-customer into the branch to meet with a bank officer (no requirement that the non-customer open an account or obtain a loan and no requirement that the existing customer do anything as well other than just bring in a non-customer to meet with a bank official) did not constitute a lottery since there was no "consideration" involved. I was told that the Vermont AG's office took an expansive interpretation of "consideration" and that "consideration" was involved because the bank was making its customers "do something" (i.e., contact and bring in a friend into the branch) and that if the bank proceeded with the contest it would be criminally prosecuted.

I thought the opinion was ridiculous and extreme, however I was talking to the assistant AG who initiated lawsuits to enforce the law. Rather than to take the opportunity to fight this extreme interpretation in court, the bank decided not to go forward with the contest.

Since then, I have called consumer fraud prosecutors from time-to-time. I never have had a repeat occurence in receiving what I thought was an extreme opinion, but I have received a lot of "tips" about gray area issues and have been able to make some minor changes to planned offers to avoid getting close to those gray areas.