Online Gambling in Arizona: an Expert Guide

Arizona defines gambling as “…one act of risking or giving something of value for the opportunity to obtain a benefit from a game or contest of chance or skill or a future contingent event but does not include bona fide business transactions which are valid under the law of contracts including contracts for the purchase or sale at a future date of securities or commodities, contracts of indemnity or guarantee and life, health or accident insurance.”

Thus, if you are risking cash on something that is not a business investment, stock market investment, or purchase involving a contract, then it is considered gambling. Even a game of skill that has a degree of chance is considered gambling. Luckily, most forms of gambling are legal in Arizona.

Gambling conducted in accordance with a tribal-state gaming compact or otherwise in accordance with the requirements of the Indian gaming regulatory act of 1988 (P.L. 100-497; 102 Stat. 2467; 25 United States Code sections 2701 through 2721 and 18 United States Code sections 1166 through 1168);

or(b) Gambling to which all of the following apply:

(i) It is operated and controlled in accordance with a statute, rule or order of this state or of the United States.

(ii) All federal, state or local taxes, fees and charges in lieu of taxes have been paid by the authorized person or entity on any activity arising out of or in connection with the gambling.

(iii) If conducted by an organization which is exempt from taxation of income under section 43-1201, the organization’s records are open to public inspection

(iv) Beginning on June 1, 2003, none of the players is under twenty-one years of age.

Arizona’s legislature spent a lot of time defining what regulated gambling is. Thus, an illegal act of gambling would best be defined by going down the list above and using process of elimination. In Arizona, most gambling is regulated, taxed, and legal.

No player receives, or becomes entitled to receive, any benefit, directly or indirectly, other than the player’s winnings from the gamble.

(b) No other person receives or becomes entitled to receive any benefit, directly or indirectly, from the gambling activity, including benefits of proprietorship, management or unequal advantage or odds in a series of gambles.

(c) Until June 1, 2003, none of the players is below the age of majority. Beginning on June 1, 2003, none of the players is under twenty-one years of age.

(d) Players “compete on equal terms with each other in a gamble” when no player enjoys an advantage over any other player in the gamble under the conditions or rules of the game or contest.

Home games of cards are covered by the statute on social gambling. These are player-versus-player games where neither player has a built-in advantage, which in this context means either a house edge or a rake. Of course, poker players have different skill levels, but that isn’t the point. Social casino games might fit under this law, which would make social casinos legal in Arizona. Of course, social casino games might be considered amusement games and therefore fit under the next law.

“Except for amusement or regulated gambling, a person commits [a violation] of benefiting from gambling if he knowingly obtains any benefit from gambling.”

The definition of “benefiting” from gaming is increasingly important in social gaming. Is benefiting only a monetary benefit? Does it mean enjoying the game or being entertained? A lawsuit in Washington State defined a “thing of value” not necessarily something won, but something spent — thus social casinos were considered gambling. If such a definition applies, then a benefit could mean virtually anything. But Arizona isn’t Washington.