491—13.2(99F) Conduct of all sports wagering.
	13.2(1) Commission policy. It is the policy of the commission to require that all industry participants conduct sports wagering in a manner suitable to protect the public health, safety, morals, good order, and general welfare of the state. Responsibility for selecting, implementing, and maintaining suitable methods of operation rests with the facility, vendor, and advance deposit sports wagering operator. Willful or persistent use or toleration of methods of operation deemed unsuitable in the sole discretion of the commission will constitute grounds for disciplinary action, up to and including revocation.
	13.2(2) Activities prohibited. A facility, vendor, or advance deposit sports wagering operator is expressly prohibited from the following activities:
	a. 	Failing to conduct advertising and public relations activities in accordance with decency, dignity, good taste, and honesty.
	b. 	Failing to comply with or make provision for compliance with all federal, state, and local laws and rules pertaining to the operation of a facility or advance deposit sports wagering operation including, but not limited to, payment of license fees, withholding payroll taxes, and violations of alcoholic beverage laws or regulations.
	c. 	Permitting cheating, failing to discover cheating that should have been discovered with reasonable inquiry, or failing to take action to prevent cheating.
	d. 	Failing to conduct sports wagering operations in accordance with proper standards of custom, decorum, and decency; or permitting any type of conduct that reflects negatively on the state or commission or acts as a detriment to the sports wagering industry.
	e. 	Performing any type of sports wagering activity, at any time, that is contrary to the representation made to the commission, commission representatives, or the public.
	f. 	Denying a commissioner or commission representative, upon proper and lawful demand, information, documents, or access to inspect any portion of the sports wagering operation.
	13.2(3) Wagers. Wagers may only be made by persons 21 years of age or older and on activities authorized pursuant to Iowa Code chapter 99F which are approved by the commission.
	13.2(4) Public notice.
	a. 	The public shall have access to the sports wagering rules, available wagers, odds or payouts, the payout period, and the source of the information used to determine the outcome of a sports wager. All licensees and advance deposit sports wagering operators shall require participants to follow the rules of play. The sports wagering rules shall be:
	(1)	Displayed in the licensee’s sports wagering area.
	(2)	Posted on the Internet site or mobile application used to conduct advance deposit sports wagering.
	(3)	Included in any terms and conditions disclosure statements of the advance deposit sports wagering system.
	b. 	During account setup and login, advance deposit sports wagering operators shall display the following information on any interface that accepts wagers:
	(1)	Account sharing is prohibited.
	(2)	Persons under the age of 21 are prohibited from wagering.
	(3)	Any other disclosures, as required by the administrator.
	13.2(5) Bond. A licensee shall post a bond or irrevocable letter of credit, at an amount determined by the commission, to the state of Iowa to guarantee that the licensee and any vendor or advance deposit sports wagering operator licensed in conjunction with the licensee faithfully makes the payments, keeps its books and records and makes reports, and conducts its gambling games and sports wagering in conformity with Iowa Code chapter 99F and the rules adopted by the commission.
	13.2(6) Reserve. A reserve in the form of cash or cash equivalents segregated from operational funds, an irrevocable letter of credit, payment processor reserves and receivables, a bond, or a combination thereof shall be maintained in the amount necessary to cover the outstanding vendor sports wagering liability and advance deposit sports wagering liability. An accounting of this reserve shall be made available for inspection to the commission upon request.
	a. 	The method of reserve shall be submitted to and approved by the administrator prior to implementation.
	b. 	Reserve calculation shall include the following: patron accounts, future wagers liability, unpaid wagers and pending withdrawals.
	c. 	If, at any time, the licensee’s total reserve is less than the amount required by the reserve calculation, the licensee shall notify the commission of this deficiency within 72 hours.
	d. 	On a form provided by the commission, the controller or an employee of higher authority shall file a monthly attestation to the commission that the reserve funds have been safeguarded pursuant to this subrule. The attestation shall be provided to the commission no later than 15 days after the end of each month.
	13.2(7) Internal controls. Licensees and advance deposit sports wagering operators shall submit a description of internal controls to the administrator. The submission shall be made at least 30 days before sports operations are to commence unless otherwise approved by the administrator. All internal controls must be approved by the administrator prior to commencement of sports operations. The operator shall submit to the administrator any changes to the internal controls previously approved at least 15 days before the changes are to become effective unless otherwise directed by the administrator. It shall be the affirmative responsibility and continuing duty of each licensee and advance deposit sports wagering operator and their employees to follow and comply with all internal controls. The submission shall include controls and reasonable methods that provide for the following:
	a. 	To prohibit wagering by coaches, athletic trainers, officials, players, or other individuals who participate and persons employed in a position with direct involvement with coaches, athletic trainers, officials, players or other individuals who participate in an authorized sporting event in which wagers may be accepted. Licensees shall demonstrate the capability, subject to review and approval by the administrator, to prevent prohibited persons from wagering on events on which they are not allowed to wager by implementing one of the following:
	(1)	Organize and maintain a list of prohibited persons.
	(2)	Participate in a third-party association or group that organizes and maintains a list of prohibited persons.
	b. 	To identify and suspend accounts opened by individuals on behalf of persons under the age of 21.
	c. 	To promptly report to the commission any criminal or disciplinary proceedings commenced against the licensee or its employees.
	d. 	To promptly report to the commission, in a format approved by the administrator, any abnormal wagering activity or patterns that may indicate a concern about the integrity of an authorized sporting event or events, and any other conduct with the potential to corrupt a wagering outcome of an authorized sporting event for purposes of financial gain, including but not limited to match fixing, and suspicious or illegal wagering activities, including the use of funds derived from illegal activity, wagers to conceal or launder funds derived from illegal activity, use of agents to place wagers, account sharing, or use of false identification. Integrity-monitoring procedures shall also provide for the sharing of information with other licensees, other governing authorities, and accredited sports governing entities by participating in an integrity-monitoring association or group or by another method as approved by the administrator.
	e. 	Written notification to the commission for any incident where there is a violation involving criminal activity, Iowa Code chapter 99F, a commission rule or order, or an internal control within 72 hours of detection. The licensee or advance deposit sports wagering operator shall provide a written report detailing the violation as required by and in a format approved by the administrator.
	f. 	The segregation of incompatible functions so that no employee is in a position to perpetrate and conceal errors or irregularities in the normal course of the employee’s duties.
	g. 	User access controls for all sensitive and secure, physical and virtual, areas and systems within a sports wagering operation.
	h. 	Treatment of problem gambling by:
	(1)	Identifying problem gamblers.
	(2)	Complying with the process established by the commission pursuant to Iowa Code section 99F.4(22) and 491—subrule 5.4(12).
	(3)	Cooperating with the Iowa gambling treatment program in creating and establishing controls.
	(4)	Including information on the availability of the gambling treatment program in a substantial number of the licensee’s advertisements and printed materials.
	i. 	Setoff winnings of customers who have a valid lien established under Iowa Code chapter 99F.
	13.2(8) Revenue reporting. Reports generated from the sports wagering system shall be made available as determined by the commission. The reporting system shall be capable of issuing reports by wagering day, wagering month, and wagering year. Wagering data shall not be purged unless approved by the commission. The reporting system shall provide for a mechanism to export the data for the purposes of data analysis and auditing or verification. The reporting system shall be able to provide, at a minimum, the following sports wagering information:
	a. 	The date and time each event started and ended.
	b. 	Total amount of wagers collected.
	c. 	Total amount of winnings paid to players.
	d. 	Total amount of wagers canceled, voided, and expired.
	e. 	Commission or fees collected.
	f. 	Total value of promotional play or free play used to purchase or execute a sports wager.
	g. 	Event status.
	h. 	Total amount held by the operator for the player accounts.
	i. 	Total amount of wagers placed on future events.
	j. 	Total amount of winnings owed but unpaid by the operator on winning wagers.
	k. 	The date, time, stake amount, win amount and individual associated with each event where winnings are required to be reported on Internal Revenue Service form W-2G, as recorded by the reporting system.
	13.2(9) Unclaimed winnings and abandoned accounts. Unclaimed winnings and abandoned accounts are subject to the following requirements:
	a. 	Abandoned player accounts under this rule are subject to Iowa Code chapter 556.
	b. 	Player accounts are considered abandoned if no activity by the account holder has occurred for three years. Player activity includes making a wager, making an account deposit, or withdrawing funds.
	c. 	No licensee or advance deposit sports wagering operator shall charge an administration fee or maintenance fee for any inactive player account derived from state of Iowa residents at any time for any reason.
	13.2(10) Annual audit. If a vendor is conducting sports wagering for a casino licensee, an audit of the sports wagering operations for the vendor or parent company of the vendor shall be conducted by certified public accountants authorized to practice in the state of Iowa, and the audit shall be provided to the commission within 90 days of the vendor’s fiscal year and meet the following conditions:
	a. 	Inclusion of an internal control letter, audited balance sheet, and audited profit-and-loss statement including a breakdown of expenditures and subsidiaries of sports wagering activities.
	b. 	Inclusion of a supplement schedule indicating financial activities on a calendar-year basis if the vendor’s fiscal year does not correspond to the calendar year.
	c. 	Inclusion of a supplement schedule for all Iowa locations in which the vendor operates.
	d. 	Report of any material errors, irregularities that may be discovered during the audit, or notice of any audit adjustments.
	e. 	Availability, upon request, of an engagement letter for the audit between the vendor or parent company of the vendor and the auditing firm.
	13.2(11) Revenue reports. Licensees and advance deposit sports wagering operators shall provide additional reports, as determined necessary by the administrator, that detail the revenue submission required by 491—paragraph 5.4(10)“d.” Reports shall be provided to the commission in a format approved by the administrator. The administrator shall provide written notice to any licensee if additional reports are determined necessary. In addition, the administrator shall provide adequate time to any licensee if a report needs to be created to satisfy this requirement.
	13.2(12) Ticket payouts. A method shall be available for players to collect at any time during the facility’s hours of operation winnings from wagers made in person at a facility. Winnings required to be reported on Internal Revenue Service Form W-2G are exempt from this requirement.
	13.2(13) Records. Licensees shall provide all information requested by the commission. Access to this information shall be prompt, and copies of the information shall be delivered within seven days or less as ordered or requested by the commission. The licensees shall ensure all books and records and the retention of all books and records comply with 491—subrule 5.4(14). All records pertaining to wagers shall be available to allow for player complaint resolution. All records pertaining to the accounts of persons who registered or have account activity in Iowa shall be available to allow for audits and investigations.
[ARC 4618C, IAB 8/28/19, effective 7/31/19; see Supension note at end of chapter; ARC 5016C, IAB 4/8/20, effective 5/13/20; see Delay note at end of chapter; ARC 5422C, IAB 2/10/21, effective 3/17/21; ARC 6169C, IAB 2/9/22, effective 3/16/22; ARC 6895C, IAB 2/22/23, effective 3/29/23; ARC 7634C, IAB 2/21/24, effective 3/27/24]