"Dinner with Barack" fundraisers broke Federal law

After posting yesterday about the perils of using raffles as campaign fundraisers in Florida, I was contacted by Jessica Robinson - associate general counsel at AFSCME (and perhaps the nation's foremost expert on raffle laws) - who offered more insight into the legalities of raffles.

Here is what Jessica had to say:

"I've discovered that, as far as I can tell, Missouri is the only state that does not regulate raffles. Many states, perhaps a majority, prohibit lotteries (including raffles) for political purposes. Most of those that do permit the political use of lottery proceeds require organizations conducting the raffles to undertake some sort of registration with the state or a local government entity, require the entity conducting the raffle to qualify for a gambling permit or license, restrict the value of prizes offered, limit the amount charged for a raffle ticket, require periodic reports with the government, confine the conduct of the raffles to particular location, require extensive background checks for those individuals responsible for the conduct of the raffle, etc.

California (which does not permit the use of raffles for political fundraising) prohibits the use of the internet for raffle advertisements. Hawaii (and perhaps one other jurisdiction - Kansas, maybe?) strictly prohibits the use of lotteries for any purpose.

It is legally impossible to conduct a nationwide raffle, whether the funds are being used for political purposes or not. This, of course, is of great importance, because running an interstate gambling operation that does not comply with the laws in each state in which it is being conducted subjects you to both criminal and civil penalties under the Federal RICO statute.

The trick that keeps you out jail is to offer an 'alternative method of entry' that does not require payment of consideration. For instance, you can allow participants to enter for a chance to win by mailing in a 3X5 card with the participant's name and contact information. (Although, that particular method of entry is not permitted in Vermont, which treats the payment of postage as consideration.) These types of fundraising mechanisms are generally known as 'sweepstakes.'

But, you should also beware of political sweepstakes - a handful of states also require organizations conducting sweepstakes to register with the state!"