Kentucky Administrative Regulations › Title 809 - Public Protection Cabinet - Kentucky Horse Racing Commission › Chapter 10 - Technical Criteria › Section 809 KAR 10:001 - Definitions

Current through Register Vol. 51, No. 1, July 1, 2024
RELATES TO: KRS 138.552, Chapter 230,  31 C.F.R. 1010.100(ww)
NECESSITY, FUNCTION, AND CONFORMITY: KRS 230.260(16) requires
				the commission to promulgate administrative regulations to establish standards
				for the conduct of sports wagering. This administrative regulation establishes
				definitions for terms used throughout the commission's sports wagering
				administrative regulations.
Section 1.
			 Definitions.
(1) "Abnormal wagering activity"
			 means wagering activity exhibited by one (1) or more patrons and considered by
			 a licensee to be an indicator of suspicious or illegal wagering
			 activity.
(2) "Account holder"
			 means an individual for whom the licensee has opened a sports wagering
			 account.
(3) "Act" means KRS 138.552 and Chapter 230.
(4)
			 "Adjusted gross revenue" is defined by KRS 138.552(1)(a).
(5) "Affiliate" means a person that, owns,
			 controls, manages, or is operationally interdependent with a
			 licensee.
(6) "Amateur youth
			 sporting event" is defined by KRS 230.210(3).
(7) "Applicant" means a person who applies
			 with the racing commission to be an authorized licensee.
(8) "Cancelled wager" means a sports wager
			 that was valid at the time it was made but has since been invalidated in
			 accordance with KAR TITLE 809 due to an event or action that prevents its
			 completion.
(9) "Card" means the
			 list of sporting events and types of wager from which a patron can make
			 selections for a given pool.
(10)
			 "Cash" means U.S. currency.
(11)
			 "Cash equivalent" means an asset convertible to cash for use in connection with
			 authorized sports wagering, including:
(a)
			 Traveler's checks;
(b) Foreign
			 currency and coin;
(c) Certified
			 checks, cashier's checks, and money orders;
(d) Personal checks and drafts;
(e) Digital, crypto, and virtual
			 currencies;
(f) Online and mobile
			 payment systems that support online money transfers; and
(g) Electronic devices with "prepaid access",
			 as defined by  31 C.F.R. Section 1010.100(ww).
(12) "Confidential information" means:
(a) The amount of money credited to, debited
			 from, withdrawn from, or present in any particular sports wagering
			 account;
(b) The amount of money
			 wagered by a particular patron on any event or series of events;
(c) The unique sports wagering account ID or
			 username and authentication credentials that identify the particular account
			 holder;
(d) The identities of
			 particular sporting events or types of wagers on which the patron is wagering
			 or has wagered; and
(e) Unless
			 otherwise authorized by the patron, the name, address, and other information in
			 possession of the licensee that would identify the patron to anyone other than
			 the racing commission or the licensee.
(13) "Communications technology" means the
			 methods used and the components employed to facilitate the transmission of
			 information, such as electronic communications, and transmission and reception
			 systems based on wire, cable, radio, microwave, light, optics, or computer data
			 networks or any similar electronic agent, such as the internet and
			 intranets.
(14) "Critical employee"
			 means any employee whose duties directly impact the integrity of sports
			 wagering in the Commonwealth, including:
(a)
			 An individual who has the capability of affecting the outcome of sports
			 wagering through deployment of code to production for any critical components
			 of a sports wagering system;
(b) An
			 individual who can deploy code to production and directly supervises
			 individuals who have the capability of affecting the outcome of sports wagering
			 in Kentucky through deployment of code to production for other than read-only
			 or the equivalent access to any critical components of a sports wagering
			 system;
(c) An individual who
			 directly manages a licensee or who directly supervises an individual who
			 directly manages a licensee; or
(d)
			 An individual in a decision-making or managerial role, who has the capability
			 to directly affect the outcome of a sports wager or a payout to a
			 patron.
(15) "Data
			 source" means a supplier that sells league or event data, participant, or team
			 statistics necessary to enable sports wagering.
(16) "Department" means Department of
			 Revenue.
(17) "Electronic sports",
			 "e-sports", "competitive video game events", and "electronic sporting events"
			 means leagues, competitive circuits, tournaments, or similar competitions in
			 which individuals or teams play video games, typically for spectators, either
			 in-person or online, for the purpose of prizes, money, or
			 entertainment.
(18) "Electronic
			 sporting event operator" means a person or entity that sanctions, manages, or
			 organizes an electronic sporting event.
(19) "Geofence" is defined by KRS 230.210(7).
(20) "GLI-CMP Guide"
			 means the Gaming Laboratories International, GLI-CMP: Change Management Program
			 Guide, Version 1.0, Published May 6, 2020.
(21) "GLI-33 Standards" means the Gaming
			 Laboratories International, GLI-33: Standards for Event Wagering Systems,
			 Version. 1.1, and its appendices, Revised May 14, 2019.
(22) "Integrity monitoring" means the
			 monitoring of sports wagering to identify abnormal or suspicious wagering
			 activities from a match-fixing and sporting corruption standpoint.
(23) "Internal controls," "minimum internal
			 control standards," or "control standards" means a system of internal
			 procedures, as well as administrative and accounting controls related to the
			 integrity of sports wagering. This type of system includes wagering rules and
			 is required by the racing commission as a condition to sports wagering,
			 pursuant to the license conditions issued by the racing commission pursuant to
			 KRS 230.290(3).
(24) "Layoff wager"
			 means a wager placed by a licensee with another licensee for the purpose of
			 offsetting sports wagers.
(25)
			 "Licensed premises" is defined by KRS 230.210(16).
(26) "Licensed facility for sports wagering"
			 is defined by KRS 230.210(15).
(27)
			 "Licensee" means the holder of a sports wagering operator's license, service
			 provider license, or an occupational license as applicable.
(28) "Mobile sports wagering" means the
			 conduct of sports wagering through or by means of Web sites or mobile
			 applications.
(29) "Multi-factor
			 authentication" means a type of authentication that uses two (2) or more of the
			 following to verify a person's identity:
(a)
			 Information known only to the person (for example, a password, pattern, or
			 answers to challenge questions);
(b) An item possessed by a person (for
			 example, an electronic token, physical token, or an identification card);
			 or
(c) A person's biometric data
			 (for example, fingerprints, facial recognition, or voice
			 recognition).
(30)
			 "Operator licensee" or "sports wagering operator" or means a Kentucky racing
			 association licensed to conduct sports wagering pursuant to KRS 230.805.
(31) "Person" is defined
			 by KRS 230.210(19).
(32) "Personal
			 identifying information" means any sensitive information that could potentially
			 be used to identify a particular patron, such as a legal name, date of birth,
			 place of birth, social security number (or equivalent government identification
			 number), driver's license number, passport number, residential address, phone
			 number, email address, debit instrument number, credit card number, or bank
			 account number.
(33) "Patron" means
			 a person who wagers on sporting events.
(34) "Pool" means an offering in which
			 patrons can make selections of outcomes on a set number of sporting events and
			 types of wagers on a card in order to enter for a chance to win all or a
			 portion of the prize pool.
(35)
			 "Prize pool" means the prizing available for an individual tournament, contest,
			 or pool.
(36) "Prohibited patron"
			 means:
(a) Any "underage person", as defined
			 by subsection (63) of this section;
(b) Any individual wagering while not in the
			 authorized geographic boundaries within the Commonwealth of Kentucky;
(c) Any individual wagering on behalf of
			 another;
(d) Any restricted patron
			 wagering in violation of their restrictions;
(e) Any voluntarily or involuntarily excluded
			 person; or
(f) Any individual
			 wagering in violation of Commonwealth, local, or federal law.
(37) "Race and sports book" means
			 the area designated by the licensee that is utilized as the primary location
			 for displaying sporting events and offering sports wagering on the licensed
			 premises.
(38) "Racing commission"
			 is defined by KRS 230.210(22).
(39)
			 "Rake" means the fee that is deducted by a licensee from entry fees paid by
			 patrons who participate in a tournament, contest, or pool.
(40) "Rake adjustment" means an adjustment
			 made by a licensee to account for any shortfall in connection with a
			 tournament, contest, or pool.
(41)
			 "Restricted patron" means any patron restricted by KRS 230.820 or
			 230.823.
(42) "Self-exclusion list"
			 means a list of individuals who voluntarily excluded themselves from
			 establishing or maintaining a sports wagering account with a
			 licensee.
(43) "Sensitive
			 information" means personal identifying information, transactional wagering
			 data, authentication credentials, and other data to be handled in a secure
			 manner such as PINs and passwords and secure seeds and keys used in
			 encryption.
(44) "Service provider"
			 is defined by KRS 230.210.
(45)
			 "Shared liquidity pool" means a tournament, contest, or pool offering in
			 Kentucky and at least one (1) other jurisdiction where patrons can make
			 selections of outcomes on a set number of sporting events and types of wager on
			 a card in order to enter for a chance to win all or a portion of the prize
			 pool.
(46) "Sporting event" is
			 defined by KRS 230.210(26).
(47)
			 "Sports governing body" is defined by KRS 230.210(27).
(48) "Sports wagering" is defined by KRS 230.210(28).
(49) "Sports wagering
			 account" or "account" means an account established by an account holder for use
			 in sports wagering with a specific identifiable record of deposits, wagers, and
			 withdrawals.
(50) "Sports wagering
			 device" is defined by KRS 230.210(29).
(51) "Sports wagering kiosk" means a sports
			 wagering device within a licensed facility for sports wagering that, at a
			 minimum, can be used for the submission of wagers placed by a patron directly
			 and can be used for redemption of applicable awards or prizes.
(52) "Sports wagering service provider" or
			 "service provider" is defined by KRS 230.210(30).
(53) "Sports wagering system" means the
			 hardware, software, firmware, communications technology, and other equipment,
			 as well as procedures implemented in order to allow patron participation in
			 sports wagering, and, if supported, the corresponding equipment related to the
			 display of the wager outcomes, and other similar information necessary to
			 facilitate patron participation.
(54) "Sports wagering ticket" or "ticket"
			 means a printed record, or digital representation thereof, issued by a sports
			 wagering system that contains information pertaining to a sports
			 wager.
(55) "Sports wagering
			 voucher" or "voucher" means a printed record, or digital representation
			 thereof, issued by a sports wagering system that can be used to fund a sports
			 wager or can be redeemable for cash.
(56) "Sufficient clarity" means the capacity
			 of a surveillance system to record images:
(a)
			 At a minimum of twenty (20) frames per second or equivalent recording speed, or
			 other recording speed approved by the commission to clearly identify the
			 intended activity, person, object, or location; and
(b) At a resolution determined by the racing
			 commission to clearly identify the intended activity, person, object, or
			 location.
(57)
			 "Surveillance operation room" means the secured area where surveillance takes
			 place or where active surveillance equipment is located.
(58) "Surveillance system" means a system of
			 video cameras, monitors, recorders, video printers, switches, selectors, and
			 other equipment used for surveillance.
(59) "Suspicious or illegal wagering
			 activity" means abnormal wagering activity that cannot be explained and is
			 indicative of any prohibited activity or conduct that could corrupt the outcome
			 of an event, including:
(a)
			 Match-fixing;
(b) The manipulation
			 of an event;
(c) Misuse of inside
			 information;
(d) A potential breach
			 of a sports governing body's or equivalent's internal rules or code of conduct
			 pertaining to sports wagering; or
(e) Any other conduct that corrupts the
			 outcome of an event.
(60) "Supplier" means a person who provides
			 services, goods, software, or other components necessary for the creation of
			 sports wagering markets and determination of sports wager outcomes, to any
			 licensee involved in the acceptance of sports wagers, such as: providers of
			 data feeds and odds services, internet platform providers, risk management
			 providers, and integrity monitoring providers.
(61) "Ticket writer station" means a sports
			 wagering device that at a minimum will be used by a ticket writer for the
			 execution or formalization of wagers placed on behalf of a patron.
(62) "Type of wager" means the form of a
			 wager offered by a licensee, such as single game bets, teaser bets, parlays,
			 over-under bets, money line bets, pools, in-game wagering, in-play bets,
			 proposition bets, and straight bets.
(63) "Underage person" means any person under
			 eighteen (18) years of age.
(64)
			 "Void wager" or "voided wager" means a sports wager that was not valid at the
			 time it was placed or a sports wager that was valid at the time it was placed
			 but has since become invalid as established in  809 KAR 10:002, Section
			 8.
(65) "Voluntarily excluded
			 person" means any individual whose name is included, at their own request, on a
			 self-exclusion list.
(66) "Wager"
			 or "sports wager" means a sum of money or representation of value that is
			 risked on a sporting event for which the outcome is uncertain.
(67) "Wagering window" means a teller window
			 dedicated to the receipt and processing of sports wagers and pari-mutuel wagers
			 on horse racing in the race and sports book location of a licensed facility for
			 sports wagering.
(68) "Web site or
			 mobile application" means a Web site or application on a mobile phone or other
			 device through which an individual is able to place a sports wager.
(69) "Winnings" means the total cash value of
			 all property or sums, such as the currency or instruments of monetary value
			 paid to a patron by a licensee as a direct result of a winning sports
			 wager.