5-1203. Prohibited employees; procedures and controls
A. The fantasy sports contest operator may not employ an individual and, if already employed, shall terminate an employee who is identified through regulations issued by the department if the individual meets any of the following criteria:
1. Has been convicted of any gaming offense.
2. Has been convicted of a felony in the seven years before submission of the employment application unless that felony has been set aside.
3. Has ever been convicted of a felony related to extortion, burglary, larceny, bribery, embezzlement, robbery, racketeering, money laundering, forgery, fraud, murder, voluntary manslaughter or a sexual offense that requires the individual to register pursuant to section 13-3821.
4. Has knowingly and wilfully provided materially important false statements or information or omitted materially important information on the individual's employment application or background questionnaire.
5. Is an individual whose prior activities, criminal record, if any, or reputation, habits and associations pose a threat to the public interest or to the effective regulation and control of gaming or create or enhance the dangers of unsuitable, unfair or illegal practices, methods and activities in conducting gaming or carrying on the business and financial arrangements incidental to gaming.
B. As a condition of licensure, a fantasy sports contest operator must submit to and receive approval from the department for commercially reasonable procedures and internal controls intended to do all of the following:
1. Prevent the fantasy sports contest operator or its owners, directors, officers and employees and any relative of any of these individuals living in the same household from participating in a fantasy sports contest offered to the public.
2. Prevent the employees or agents of the fantasy sports contest operator from sharing protected information with third parties unless the protected information is otherwise made publicly available.
3. Prevent participants and officials in an athletic event from participating in a fantasy sports contest that is based on the athletic event.
4. Establish the number of entries a single fantasy sports contest player may enter in a single fantasy sports contest and take reasonable steps to prevent fantasy sports contest players from submitting more than the allowable number of entries.
5. Identify each highly experienced player by a symbol attached to the highly experienced player's username.
6. Offer some fantasy sports contests that are open only to players other than highly experienced players.
7. Either of the following:
(a) Segregate the deposits in the fantasy sports contest players' accounts from operational money.
(b) Maintain a reserve in the form of cash, cash equivalents, payment processor reserves, payment processor receivables, an irrevocable letter of credit, a bond or a combination of these, the aggregate amount of which exceeds the total dollar value amount of deposits in the fantasy sports contest players' accounts. The reserve may not be used for operational activities.
8. Ensure compliance with the applicable state and federal requirements to protect the privacy and online security of a fantasy sports contest player and the fantasy sports contest player's account.
9. Otherwise ensure the integrity of fantasy sports contests.
C. A licensed fantasy sports contest operator shall comply with the procedures and internal controls that are submitted to and approved by the department under subsection B of this section. A licensed fantasy sports contest operator may make technical adjustments to its procedures and internal controls if the adjustments are not material and it notifies the department within twenty-one days of the changes becoming effective and continues to meet or exceed the standards required by this chapter and any rules adopted by the department.
D. Procedures submitted to the department under subsection B of this section are confidential and privileged and are not subject to disclosure under title 39, chapter 1, article 2.