Illegal Gambling In New York – All You Need TO Know

by ECL Writer
New York Gambling Crime Frequently Asked Questions

Illegal gambling In New York has long been a persistent issue. Despite the presence of strict regulations and laws governing gambling activities, underground gambling operations continue to thrive in the shadows, drawing in players with the promise of quick and easy winnings. From sports betting to poker rooms, illegal gambling in New York has become a lucrative business for those willing to take the risk. But as authorities step up their efforts to crack down on these illicit activities, the stakes are getting higher for both the operators and the players. In this article, Eastcoastlaws.com will explore the scope of illegal gambling in New York, its impact on communities and individuals, and the measures being taken to combat it.

Anyone who illegally organizes or manages a gambling ring, a gambling establishment, a lottery, or a similar business faces substantial criminal penalties in New York. The distinction between legal and criminal gaming can, however, occasionally be hazy. The mere act of playing in a gambling activity is not illegal, and certain organizations are permitted to operate lotteries and other forms of gambling.

Overview Of Illegal Gambling In New York

The following actions are prohibited by the gambling laws of New York: promoting gambling (such as through bookmaking or running a lottery), possessing gambling records (such as lotteries, bookmaking information, or easily destroyed forms of paper relating to gambling), possessing a gambling device (such as slot machines or other gambling devices), engaging in gaming fraud (including cheating a casino or engaging in any other type of fraud involving a bet or wager), and using illegal or counterfeit gaming in any way.

Gambling, in accordance with New York law, occurs when a person takes something of worth in a competition, game of chance, or another event beyond their control in the hopes that they would win money or receive something of value in return, depending on the outcome of the wager. This explanation is extensive. It covers a wide range of activities, such as fantasy sports, cockfighting, dice, championship auto racing, and sports betting. Although there are no particular restrictions on gambling in New York, the law still holds true for New Yonkers as long as it is inside the state’s boundaries.

Ways To Commit A Gambling Offense In New York

In New York, illegal gambling offenses can fall into any of these three categories. Let’s take a closer look at each of these offenses:

  • Promoting Unlawful Gambling: Promoting unlawful gambling is a Class A misdemeanor in New York, punishable by up to one year in jail and/or a fine. This offense involves intentionally advancing or profiting from illegal gambling activity, such as running an illegal sportsbook or hosting an underground poker game.
  • Possessing Gambling Records: Possessing gambling records is also a Class A misdemeanor in New York. This offense involves knowingly possessing or keeping any records, such as betting slips or account books, that relate to an illegal gambling activity. Offenders can face up to one year in jail and/or a fine.
  • Possessing Gambling Devices or Equipment: Possessing gambling devices or equipment is a lesser offense than promoting unlawful gambling or possessing gambling records, but it can still result in serious penalties. This offense involves knowingly possessing any device or equipment, such as slot machines or video poker machines, that can be used for illegal gambling purposes. It is a Class A misdemeanor, punishable by up to one year in jail and/or a fine.

Overall, New York takes illegal gambling very seriously, and law enforcement officials are constantly working to identify and shut down illegal gambling operations across the state. If you are involved in any type of illegal gambling activity, it’s important to understand the potential consequences and seek legal guidance to protect yourself.

Examples Of Situations Where Charges Of Illegal Gambling Offenses May Be Filed

Here are some examples of situations where charges of illegal gambling offenses may be filed:

  • John runs an underground poker game in his basement where people bet real money. Since John is not authorized by the state to operate a gambling business, he could be charged with operating an illegal gambling business.
  • Susan places bets on sports events with a bookmaker who is not authorized by the state. Since participating in illegal gambling is a Class A misdemeanor, Susan could be charged with this offense.
  • Mike is caught with a ledger that contains records of illegal gambling activities. Since possession of gambling records is a misdemeanor offense in New York, Mike could face charges for this offense.
  • Sarah runs a website that promotes illegal online gambling. Since promoting gambling is a misdemeanor offense in New York, Sarah could be charged with this offense.
  • Tom is caught with a slot machine in his garage that he uses for illegal gambling activities. Since possession of gambling devices is a misdemeanor offense in New York, Tom could face charges for this offense.

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 that 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.

 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 In New York

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:

  1. You must have knowledge of the gambling-related activity, AND;
  2. You must aid or assist unlawful gambling activity, OR;
  3. 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:

  1. 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;
  2. 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:

  1. You must have knowledge of the gambling-related content of the writings, papers, or other records, AND;
  2. 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:

  1. The gambling records represent more than five bets totaling over $5,000, OR;
  2. 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:

  1. You must have knowledge of the gambling-related character of the device, AND;
  2. You must manufacture, possess, sell, exchange, or transport the device, AND;
  3. A 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 activities 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, casual 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:

  1. Kate owns a bar where bar patrons play high-stakes blackjack every night.
  2. 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:

  1. Kate receives a $10 fee for anyone who wants to play in her game of blackjack.
  2. 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:

  1. Kate possesses various lottery tickets.  Her possession of the tickets is presumptive evidence that she knows that they are gambling-related records.
  2. Kate keeps a book indicating all the tickets purchased for all participants in the lottery.
  3. 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:

  1. Kate possesses a slot machine in her garage.  Her possession of the machine is presumptive evidence that she knows of its character or content.
  2. 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. 

Penalties To Illegal Gambling In New York

  • 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.

Sentencing Enhancements

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.

They include:

  •     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 In New York

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 to your offensive 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:

  1. First, possession of gambling records is not a crime if the records in possession were not intended and in fact never used for gambling.
  2. 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.

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