§339 — Title 12 Banks and Banking | U.S. Code

Summary

State member banks must not take part in lotteries or help run them. They may not handle lottery tickets or bets used instead of tickets. They may not announce, advertise, or publicize a lottery or name or promote any participant or winner. Banks also may not let people use any part of a bank branch for those banned activities or let the public have direct access from a bank office to a place where those activities happen. Definitions in one line each: “Deal in” means making, taking, buying, selling, redeeming, or collecting. “Lottery” means a plan (not a savings-promotion raffle) where three or more people put up money or credit for a chance that some will get more back, with winners picked by chance, a contest, or event results. “Lottery ticket” means any right or paper showing a chance to win. “Savings promotion raffle” means a prize drawing where the only way to enter is by putting money into a savings account and each entry has an equal chance, under rules set by the bank regulator. Banks may still accept deposits, cash checks, or provide normal banking services for a state that runs a lottery or for officials who run it. The Federal Reserve Board must make rules to enforce these limits and stop attempts to get around them.

Title 12, §339

Banks and Banking — Source: USLM XML via OLRC

(a)A State member bank may not—

(1)deal in lottery tickets;

(2)deal in bets used as a means or substitute for participation in a lottery;

(3)announce, advertise, or publicize the existence of any lottery; 11 So in original. The word “or” probably should appear.

(4)announce, advertise, or publicize the existence or identity of any participant or winner, as such, in a lottery.

(b)A State member bank may not permit—

(1)the use of any part of any of its banking offices by any person for any purpose forbidden to the bank under subsection (a), or

(2)direct access by the public from any of its banking offices to any premises used by any person for any purpose forbidden to the bank under subsection (a).

(c)As used in this section—

(1)The term “deal in” includes making, taking, buying, selling, redeeming, or collecting.

(2)The term “lottery” includes any arrangement, other than a savings promotion raffle, whereby three or more persons (the “participants”) advance money or credit to another in exchange for the possibility or expectation that one or more but not all of the participants (the “winners”) will receive by reason of their advances more than the amounts they have advanced, the identity of the winners being determined by any means which includes—

(A)a random selection;

(B)a game, race, or contest; or

(C)any record or tabulation of the result of one or more events in which any participant has no interest except for its bearing upon the possibility that he may become a winner.

(3)The term “lottery ticket” includes any right, privilege, or possibility (and any ticket, receipt, record, or other evidence of any such right, privilege, or possibility) of becoming a winner in a lottery.

(4)The term “savings promotion raffle” means a contest in which the sole consideration required for a chance of winning designated prizes is obtained by the deposit of a specified amount of money in a savings account or other savings program, where each ticket or entry has an equal chance of being drawn, such contest being subject to regulations that may from time to time be promulgated by the appropriate prudential regulator (as defined in section 5481 of this title).

(d)Nothing contained in this section prohibits a State member bank from accepting deposits or cashing or otherwise handling checks or other negotiable instruments, or performing other lawful banking services for a State operating a lottery, or for an officer or employee of that State who is charged with the administration of the lottery.

(e)The Board of Governors of the Federal Reserve System shall issue such regulations as may be necessary to the strict enforcement of this section and the prevention of evasions thereof.

Notes & Related Subsidiaries

Editorial Notes

Codification Section was enacted as section 9A of act Dec. 13, 1913, and not as part of section 9 of such act which comprises this subchapter.

Amendments

2014—Subsec. (c)(2). Pub. L. 113–251, § 3(b)(1), inserted “, other than a savings promotion raffle,” before “whereby” in introductory provisions. Subsec. (c)(4). Pub. L. 113–251, § 3(b)(2), added par. (4).

Statutory Notes and Related Subsidiaries

Effective Date

Section effective Apr. 1, 1968, see section 6 of Pub. L. 90–203, set out as a note under section 25a of this title.

§339 Participation by State Member Banks in Lotteries and Related Activities