What should an online business know before sending virtual gift cards to their customers?

Hello.

We are interested in making a mobile app where people could play various short
mini-games the wheel of fortune, scratch tickets, etc. and collect virtual
points. As soon as they get a certain amount of points, they could exchange them
for a digital prize Amazon, Paypal, eBay gift card. To collect the prize, the
person should put their email and then we would send it to them.

We would like to know if it’s legal to do this kind of activity and what should
we know before making our project.

Thank you

Asked on January 18, 2018 under Business Law, Alaska

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

This would not be legal if there any chance element to the outcome or resolution of the games. If there is a chance element, this would constitute gambling and would illegal under Alaska law, which only allows certain limited social gambling, charitable gambling, state lottery(ies), and Native American gambling. It is gambling when a prize may be won in part or whole based on chance.


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