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Utah House targets gambling at 'Internet cafes'
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

The Utah House voted Tuesday to close a loophole that some Internet cafes have used to operate games of chance — as long as it isn't their primary business — which made some seem like casinos.

It voted 72-1 to pass, and send to the Senate, HB40 by Rep. Don Ipson, R-St. George. The measure would more tightly define what types of "fringe gambling" are banned, and which are not.

A few years ago, the Legislature enacted a bill to allow cities to prosecute and close Internet cafes that critics said were fronts for gambling. The cafes would technically sell computer time or phone cards, but cities said those items were used to play casino-style games to win sweepstakes or money.

But the law also allows promotional games of chance — such as McDonald's offering its Monopoly game for prizes — that are "clearly occasional and ancillary to the primary activity of the business." Internet cafes have claimed that is what they are actually doing, even though Ipson said cities argued it was really gambling.

Ipson's bill — sought by prosecutors around the state — gives a much lengthier definition of what is and is not a promotional game of chance. It includes looking at whether options to play the game for free are available, how the game and business are marketed, whether the goods or services promoted for purchase are on terms that are commercially reasonable and whether any prize may be parlayed into additional opportunities to win more items.

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