Welcome to the ChipTalk Community

Want to join the rest of the ChipTalk members? It is free to sign up today and unlock new features, discussions, and reduce the advertising.

Sign Up

Getting around the rake in CA (long)

Discussion in 'Home Poker and the LAW' started by OnTheButton, Nov 29, 2005.

  1. OnTheButton

    OnTheButton Well-Known Member

    Joined:
    Jun 4, 2005
    Messages:
    2,861
    Likes Received:
    222
    Location:
    Santee, CA (San Diego)
    I'd like to hear EXPERIENCES with other California players that might have consulted either an attorney or the local police department about how to collect money for hosting a poker game.

    It's not that big a deal, but every week the wife and I host a low-limit ($20 buy in)NLHE poker game on Saturday nights, and usually have 7-9 guests. We often keep soda, snacks, hookahs, and even adult beverages available for those that ask nicely. We provide them mostly because if we don't, the first few hours of play are people running back and forth to the store, which for some reason they don't seem to remember to do before they come over.

    I think what inspired this thread was a friend that brought a guest the other week, and he did really well, taking home about $100 in winnings. He also ate half the cookies, a couple of (small) bags of chips, about 6 beers and sodas. He stuffed the cash in his pocket, wiped the crumbs off of his face, tossed the beer bottle in the trash and hit the road with a big smile on his face. Why not? He won money and ate/drank another $10 in free food/drink. What a deal!:sorry:

    We do pretty decent in the games, usually making a few dollars ($30-40) between the two of us by the end of the night, but most of that goes to buying the stuff for the next weeks game. And when we lose, we still spend that money on stuff regardless.

    Some of these are pretty good friends, (that we hang with outside the table) and I know they would donate money to keep the snacks and drinks flowing, but I want to make sure that the way we collect is 100% legal, without asking them for cash while in the driveway like some kind of drug dealer stuffing my pockets with cash in the shadows. We have too much to lose by skirting the gray areas, since we own the home, I own 3 businesses, and she is a school teacher that would be canned in a moment if we were even suspected of doing something illegal at home.

    We are not getting "broke" by spending this money, but it seems like the more we provide the more is expected, and often some players come over empty handed and head right to the fridge and the pantry knowing there is stuff there. I don't want to be rude by calling someone out with a "What are you doing?" however it would be nice to say, "Help yourself, you paid for it."

    We'd like to spend our poker winnings on fun stuff like everyone else does, instead of paying for the goodies that everyone enjoys and no one pays for. It's not like it's rent money we are spending, but it adds up every week when we spend it directly to make our guests more comfortable.

    The part that kills me is that whenever I host a "party" I have no problem passing the hat around to get funds for beer, food, whatever. But since we play poker as the theme for our "parties" we seem to be stuck not only providing the house, but the costs for everything else, every week. Heck when I was in college we would MAKE you pay like $5 before you even walked in the door.

    I've thought about putting an unmarked jar by the front door, and just letting people know what it is for before they even enter the house, but the lines seem pretty fuzzy to what is allowed and what could be construed as taking a rake, or trying to profit by having the players contribute to the expenses.

    Any experiences (opinions not preferred, I have plenty of them, lol) with this topic are appreciated, as it would be nice to not have to dip into our pockets every week because of the way the law is stated about the house collecting funds.
     
    #1
  2. daveyboy

    daveyboy Well-Known Member

    Joined:
    Apr 11, 2005
    Messages:
    1,048
    Likes Received:
    44
    Location:
    Ladera
    I also host poker nights every so often and what happens is that sometimes we take it for granted that everyone will bring a little something. In Hawaii, we simply called bringing a little something to a party or event as "Hawaiian Style". We all know this does'nt always happen, but what I do if I need something or want someone to bring something, I just simply ask them an hour before they are to arrive "Eh, Phil, I forgot to buy some chips and dip, could you run by the store on the way to my house and get some for me". My guests are more than willing to pick up a few things to my party if I just ask. Also, none of them has ever asked me for money for picking up some food for me.

    I just feel real wierd about collecting a rake from my buddies everytime we play poker.
     
    #2
  3. Wylecoyo

    Wylecoyo Super Moderator
    Staff Member Lifetime Supporter

    Joined:
    Jun 3, 2005
    Messages:
    5,717
    Media:
    3
    Albums:
    1
    Likes Received:
    369
    Location:
    Starboard Bridge-Wing
    According to California State Law:

    Penal Code Sec. 337j

    (a) It is unlawful for any person, as owner, lessee, or employee, whether for hire or not, either solely or in conjunction with others, to do any of the following without having first procured and thereafter maintained in effect all federal, state, and local licenses required by law:
    (1) To deal, operate, carry on, conduct, maintain, or expose for play in this state any controlled game.
    (2) To receive, directly or indirectly, any compensation or reward or any percentage or share of the revenue, for keeping, running, or carrying on any controlled game.
    (3) To manufacture, distribute, or repair any gambling equipment within the boundaries of this state, or to receive, directly or indirectly, any compensation or reward for the manufacture, distribution, or repair of any gambling equipment within the boundaries of this state.

    (b) It is unlawful for any person to knowingly permit any controlled game to be conducted, operated, dealt, or carried on in any house or building or other premises that he or she owns or leases, in whole or in part, if that activity is undertaken by a person who is not licensed as required by state law, or by an employee of that person.

    (c) It is unlawful for any person to knowingly permit any gambling equipment to be manufactured, stored, or repaired in any house or building or other premises that the person owns or leases, in whole or in part, if that activity is undertaken by a person who is not licensed as required by state law, or by an employee of that person.

    (d) Any person who violates, attempts to violate, or conspires to violate this section shall be punished by imprisonment in a county jail for not more than one year, or by a fine of not more than five thousand dollars ($5,000), or by both that imprisonment and fine.

    (e) (1) As used in this section, "controlled game" means any game of chance, including any gambling device, played for currency, check, credit, or any other thing of value that is not prohibited and made unlawful by statute or local ordinance.

    2) As used in this section, "controlled game" does not include any of the following:
    (A) The game of bingo conducted pursuant to Section 326.5.
    (B) Parimutuel racing on horse races regulated by the California Horse Racing Board.
    (C) Any lottery game conducted by the California State Lottery.
    (D) Games played with cards in private homes or residences, in which no person makes money for operating the game, except as a player.
     
    #3
  4. Wylecoyo

    Wylecoyo Super Moderator
    Staff Member Lifetime Supporter

    Joined:
    Jun 3, 2005
    Messages:
    5,717
    Media:
    3
    Albums:
    1
    Likes Received:
    369
    Location:
    Starboard Bridge-Wing
  5. Daniel

    Daniel Well-Known Member

    Joined:
    Apr 1, 2005
    Messages:
    1,735
    Likes Received:
    91
    Location:
    Killa Kali, Home of the Hustla
    my assumption (the key words here)
    is that as long as they dont pay you from the money they made that night (i.e other peoples buyins, rebuys, etc...) then its not considered part of the 'revenue'.....

    i would just have some kind of "food donation" box....
    i dono if the words "donation" make it not affiliated to the game itself...but i would assume so, (once again, lots of assumptions on my part here, as im not nearly close to a lawyer, i'm a nice guy, lol)...

    i like the first idea of just telling every1, "look, i usually provide the goods, but its getting costly, if everyone can just BYOBBB (bring ya own, bud brew & bitches...this is a cali thang).....

    good luck senor, hope you find all your answers and that i didnt just add some nonsense...

    d
     
    #5
  6. daveyboy

    daveyboy Well-Known Member

    Joined:
    Apr 11, 2005
    Messages:
    1,048
    Likes Received:
    44
    Location:
    Ladera
    I have heard of a situation here in California where a person got in trouble (with the law) for taking a rake to pay for food and drinks. Eventhough that persons intention was to only cover his cost's, the undercover cop who responded to this persons ad for more players in Craigslist (big mistake #1) turned this person in to the authorities. I'm not sure what happened in the end, but I know this person had to go to court.
     
    #6
  7. Wylecoyo

    Wylecoyo Super Moderator
    Staff Member Lifetime Supporter

    Joined:
    Jun 3, 2005
    Messages:
    5,717
    Media:
    3
    Albums:
    1
    Likes Received:
    369
    Location:
    Starboard Bridge-Wing
    My wife is a legal secretary here in CA, so I asked her boss to take a look at this for me. Based on her review, ANY money you receive in ANY manner other than from the pot during the course of regular, unscripted play would constitute a rack and would be illegal under the previously posted statue. Donations, gifts, or whatever kind of legalese spin you might want to put on it would not, according to a practicing lawyer, make it any better.

    I have given you the law, some links to more law, and the interpretation of a lawyer - do with it what you will and good luck. :)
     
    #7
  8. PocketRocket

    PocketRocket Well-Known Member

    Joined:
    Apr 29, 2005
    Messages:
    2,541
    Likes Received:
    52
    This is more an issue of common decency than anything else and isn't really related to a 'rake' per se. Some people will just insist on taking advantage of a situation, like consuming their hosts provisioins without so much as a "thank you". It's unfortunate, but you'll run into one or two in every crowd (if you get much more, find another crowd :wink: ). It might help just to drop an extra line or two into the invitation (whether it be by e-mail or phone), "bring a snack to share" "if you're not sure of what to bring, please call for suggestions". In the cases of the moochers, it's best to let someone else (other than the host) bring the issue to light (best way is to publically shame them :wink: ). One word of caution though, if people get too enthusiastic about it, you could end up with a bunch of leftovers and beverages that weren't planning for at the end of the evening (no kidding, it's been known to happen; especially if you get half of the people stopping by Costco or someplace like that for a party tray on the way to the game :disappoi: ). And in the case where it's a "bunch of guys" who would get lost walking into a supermarket, all it takes is someone (preferably a guest) to suggest "contributions" to a pot (or jar) to cover the costs of snacks and beverages. If the mix is "normal" there will generally be some contributions on the generous side that will cover the moochers. (and if you forget to invite the moochers for a week or two ... they might get the message.):wink:
     
    #8
  9. ElitePoker

    ElitePoker Well-Known Member

    Joined:
    Sep 30, 2005
    Messages:
    273
    Likes Received:
    29
    Location:
    Northern California
    I just posted a thread about the "Show 'Em!" chips were I was going to ask for a "donation" for each chip to go towards the pizza/soda/water etc. I was informed in that thread about this issue.

    http://chiptalk.net/forum/showthread.php?t=12592

    How about if you have regular players that you form a league and charge monthly membership fees (like $10/ea) to cover the cost of running the league/poker nights? Would that be legal?

    I really enjoy hosting our games every other week but I am in the same situation. I have a fully stocked bar in my game room with a kegorator. I put up a tip jar on the bar and I usually have $40+ in it by the end of the night. As far as my expenses go, we usually go through a keg of beer ($70) half a bottle of jagermeister ($10), 10-20 cans of Red Bull ($13-$26) at every event. That's not including the soda, bottled water, and misc other liquors we go through. I estimate that it usually costs me about $100-$125 per event to cover drinks. We were only putting out snacks ($10-$15) but everyone really liked it when we ordered pizzas so everyone agreed to bring $2 to chip in for the pizza ($30-$40). No one had a problem with this and I wasn't aware there was a legal problem with it. It's not the end of the world financially but $200-$300 a month in expenses is a car payment or a nice savings toward some poker gear.

    If we had a league with $10 monthly membership fees it would probably cover the food/drinks, the cost to host our website, and other poker consumeables (cards, trophys, etc.). I wouldn't be making any money but would probably limit my losses.

    Sorry for the long winded post...I would really like to find a solution to this issue.
     
    #9
  10. PocketRocket

    PocketRocket Well-Known Member

    Joined:
    Apr 29, 2005
    Messages:
    2,541
    Likes Received:
    52
    This is where you might run into issues with the Alcoholic Beverage Control Board. Which is how kids get charged when they hold "pay parties" where an admission/cover is charged at the door. It's probably best to check not only with the local constabulary but also the ABC since there is a correlation to those funds paying for alcoholic beverages.

     
    #10
  11. ElitePoker

    ElitePoker Well-Known Member

    Joined:
    Sep 30, 2005
    Messages:
    273
    Likes Received:
    29
    Location:
    Northern California
    So if I said the league membership funds would cover food/soda/water and misc expenses like website hosting/trophys/cards/chips then it would be ok? I would then have to say that all drinks are free of charge...is that playing in the grey area too much?
     
    #11
  12. PocketRocket

    PocketRocket Well-Known Member

    Joined:
    Apr 29, 2005
    Messages:
    2,541
    Likes Received:
    52
    That, quite honestly, is a question that should be poised to your own legal counsel, your local PD, and the ABC. I'm not an attorney, and even if I were, I'd run into ethics issues with the BAR if I were to dispense legal advice on a message board. However as a guide, you can probably reference charity events where alcoholic beverages may be served gratis as may be food, merely for the "donation" that grants the admission. At those events, some sort of single event license must be obtained from the ABC.

     
    #12
  13. OnTheButton

    OnTheButton Well-Known Member

    Joined:
    Jun 4, 2005
    Messages:
    2,861
    Likes Received:
    222
    Location:
    Santee, CA (San Diego)
    Thanks so far for the information folks.

    Glad to hear I am not alone, or being taken as greedy for not wanting to pay for everything every week, even though the cost is not an issue.

    ElitePoker, you and I seem to have a very similar situation, where we "created our own monsters" by being generous and offering up our hospitality to our guests. Had we just been bastards from the onset, nothing would be expected now.

    I was one of the ones that actually posted the CA gaming "legalese" put up here earlier in the thread by Wylecoyo, so I'm familiar with the exact law as stated. However "profit" is the argueable term in that code. To purchase food and beverages for distribution is an "expense" not a profit. Now if we charged directly (i.e. $1 for a soda, $3 for a beer) for those items, I could understand the complications.

    But the intent of the law is to be interpreted, right?

    The sound of a "league membership" with "dues" intrigues me.

    Anyone have any more information on this as applied to poker groups?

    There's GOT to be a way around this, since the intent is not to open a casino, but to not have to get nickled and dimed every weekend by fridge looting players.
     
    #13
  14. PocketRocket

    PocketRocket Well-Known Member

    Joined:
    Apr 29, 2005
    Messages:
    2,541
    Likes Received:
    52
    Okay, this is the way that it used to be done at a "social club" that used to charge an annual membership. The poker games were just the result of members getting together to play cards, it was not the purpose of the club. There were bottles of booze that sat on a table along with a glass. The customary "donation" for a cocktail was 25¢ in the glass (this was a long time ago), all on the honor system, no problems with the law. Unfortunately if your crowd is a bit too big, this might not work, not only might the moocher not pay their fair share, they might even steal the glass with the donations. :disappoi:

    If nothing else works, bear in mind that they are not your relatives, they're "friends" and as such you can be selective about them.



     
    #14
  15. ElitePoker

    ElitePoker Well-Known Member

    Joined:
    Sep 30, 2005
    Messages:
    273
    Likes Received:
    29
    Location:
    Northern California
    Yeah...my monthly tournament has gone from 8-10 players at the begining of this year to 17, 18, 21, & 23 the last four months. I anticipate close to, if not more than, 30 at our game coming up in a couple weeks.

    I'm going to check in with the Police Dept & District Attorney either today or tomorrow to see what I can find out. With friends bringing friends to our games now there is more of a chance of someone saying something to the authorities. When it was only 8-10 of us life long friends playing I didn't have to worry about a thing. Our $25 buy-in tourneys have been getting close to $1,000 in prize money the past couple months and I'm sure it will be over $1,000 this month. :)

     
    #15
  16. Wylecoyo

    Wylecoyo Super Moderator
    Staff Member Lifetime Supporter

    Joined:
    Jun 3, 2005
    Messages:
    5,717
    Media:
    3
    Albums:
    1
    Likes Received:
    369
    Location:
    Starboard Bridge-Wing
    I am not trying to make it appear as if I think the host should get stuck paying for everything - I was just trying to answer the question as it was asked. Based on the way the code is written and based on a CASUAL conversation with someone who happens to be a lawyer (no infringement on the BAR and no formal commissioning of legal research involved) I would caution you that there does not seem to be any legal way to "collect money for hosting a poker game."

    I don't think the issue changes in relation to whether or not what you collect covers the cost of running the game and I wouldn't feel comfortable relying on the defense that as long as you don't make a profit then you are not doing anything wrong.

    I am sure if you actually hired an attorney they could better advise you as to how to sidestep the statutes that are in place; however, I would be interested in knowing why you are so worried? If it is a friendly game and you know all the players are you really concerned someone is going to turn you in?

    For that matter, you could always throw a pizza party and have everyone pitch in for the expenses of the food and beverages. If after the pizza party is over some of the guests want to hang out and play some friendly poker while still enjoying the leftovers, who could say you were "charging" for the actual card game?
     
    #16
    Last edited: Nov 29, 2005
  17. Tatdave

    Tatdave Well-Known Member

    Joined:
    Oct 17, 2005
    Messages:
    137
    Likes Received:
    2
    Perhaps this wouldnt fly, but what if you sold everyone who came a lovely 'real casino weight' 11.5 gram dice chip for say, $5? I'm sure people would be willing to pay $5 for the thrill of owning a chip that has that real casino metallic sound.

    Selling the chips would be independent of the poker game. You could offer to sell some of those before the game started, then get on with the evening. Sorta like a tupperware party.

    This may or may not be such a gray area, but if folks are buying something from you then ya'll choose to play some cards, how's that so wrong? And wouldnt it be natural for folks who came over to buy a chip from you to want to play poker?

    Just a thought
     
    #17
  18. luckychick

    luckychick Creativity Alliance

    Joined:
    Sep 12, 2005
    Messages:
    1,826
    Likes Received:
    89
    Location:
    Edmonton
    My friend phoned a buddy of his who is a lawyer. I didn't talk to him myself, but sat there while he asked him, and here is the summary. He said that if you are collecting money to defray costs, it's not a big deal. To cover yourself, just keep the reciepts. Divide the total cost by the number of expected people and charge that per guest, and it's okay. He siad if you throw a party, and buy a keg, and do this, it is okay, as long as you are not making a profit, or charging per individual drink. The fact that you are playing poker is okay as long as you aren't making a profit (back to the save receipts thing). Don't skim the pots and it should be okay.

    P.S. He also said the cops monitor Craig's List, and it's not surprising a cop showed up to daveyboy's acquaintance's game. This seemed to be a different situation though, if he was actually taking a rake out of the pots, regardless of the intention.
     
    #18
  19. ElitePoker

    ElitePoker Well-Known Member

    Joined:
    Sep 30, 2005
    Messages:
    273
    Likes Received:
    29
    Location:
    Northern California
    Very interesting...I'm sure there is several ways around this issue. I'm going to check with my local authorities that way I'm covered. Thanks for that info...that will help when it comes time to talk to them. :happy:
     
    #19
  20. dad604

    dad604 Well-Known Member

    Joined:
    Apr 9, 2005
    Messages:
    4,431
    Likes Received:
    70
    If the 7 or 8 people were close friend, there should not be an issue with collecting to pay for drinks, food, etc. Maybe the best way would be a straight charge before the game starts.


    Once it gets bigger and you have more and more players, then I would say you could have a big legal problem.
     
    #20

Share This Page