Authorities reviewing Lucky Bob's business
OCEANSIDE -- Lucky Bob's Internet Cafe offers casino-like games that some say are illegal.
The storefront cyber cafe, tucked between a beauty salon and a grocery store, advertises that people can win more than $180,000 in "instant cash sweepstakes."
Similar operations in Florida and other states have raised law enforcement eyebrows, but this appears to be the first time this kind of establishment has settled in California.
Critics say the Internet cafe does not offer a sweepstakes contest, which is legal under state law, but a lottery, which only the California State Lottery can conduct.
The main difference between a sweepstakes and a lottery is that lottery participants pay for a chance to win the prize, according to the state Department of Consumer Affairs. Participants in a sweepstakes do not have to pay or buy anything for a chance to win.
The state has clear rules for sweepstakes, which include telling the players when the game ends and when the winners will be announced, and the odds of winning. Critics say the Internet cafe is not following those rules.
Cheryl Schmit, director of the gambling watchdog group Stand Up for California, said games similar to the ones offered by the Internet cafe have been used in Alabama, where people buy plastic cards to access the Internet and also get entries in the sweepstakes.
At the Oceanside Internet cafe, players can buy plastic cards, similar to calling cards, that they can use to log on to computers. The customer is offered various games from which to choose, ranging from slot machine games to video poker. People use the credits in the cards to play the games.
While playing, customers are eligible to win a random jackpot prize. After playing, customers can redeem, or cash out, if there are any credits left.
"This is gambling," Schmit said. "This is an illegal lottery in the state of California."
Scott Gerber, a spokesman for the state Attorney General's office, said he did not know whether the games ran afoul of state laws. Gerber said he would explore the matter further.
An Oceanside police spokesman said the department also is looking into the business.
The agent listed for the company in state records is San Diego attorney A. Dale Manicom. He could not be reached for comment Tuesday. Employees at the Oceanside location on Friday said no one was available to discuss the business.
State records show there are at least five other similar establishments in California listed under the same agent, including Lucky Jolar's Internet Cafe in La Mesa.
I. Nelson Rose, a professor at Whittier Law School in Costa Mesa who specializes in gambling law, said this appears to be a gray area in the law. He said he is not familiar with the games and depending on how they are used, they could be legal.
Sweepstakes are commonly used by large corporations to dole out prizes, including cash, as a way to drum up business. Think McDonald's Monopoly games, in which customers get game pieces when they buy products, such as soft drinks, burgers and french fries.
A key element in legal sweepstakes is that there is no purchase necessary, Rose said. People must be allowed to play without charge or the need to buy any products.
"It must be clearly marked 'no purchase necessary' and alternatives (to purchases) must be available for anybody," Rose said.
The ad for Lucky Bob's Internet Cafe reads "No purchase necessary to win." It also advertises "free drinks and food." Players get 100 free entries for the sweepstakes with every dollar of Internet time purchased, according to the ad.
Schmit raised other questions about the games' legality.
The state's sweepstakes law sets rules the Internet cafe does not appear to be following, she said. For example, players must be told when the contest will take place and when the winner will be announced. The Internet cafe's games also require the use of a computer to reveal the winner, which is illegal under state law, Schmit said.
"The ad says 'instant winners.' That is where it tells you that the cards are predetermined -- and that makes it a lottery," Schmit said. "Just like a scratch-off ticket."
David Quintana, the legislative director for the California Tribal Business Alliance, an industry group that represents several gambling tribes, said he also believes the games are illegal. He said better regulation over these establishments is needed in the state.
"There is absolutely no regulatory or criminal oversight," Quintana said. "If we added three machines over our limit, we'd have three levels of law enforcement at our door."
Contact staff writer Edward Sifuentes at 760-740-3511.
Posted in Oceanside on Tuesday, May 19, 2009 12:00 am Updated: 7:18 am. | Tags: X.lucky.20, Coastal, Local, Nct, News, Oceanside, Z.google.oceanside, Z.google.local
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