SOUTH DAKOTA

I. Definition of gambling

S.D. Const. Art. III, § 25 (1889), explicitly states that any game of chance, lottery, or gift enterprise is illegal in the state unless it is operated by charitable organizations or regulated by the state of South Dakota itself. A game of chance in South Dakota has been interpreted broadly, covering most forms of gambling. Poppen v. Walker, 520 N.W.2d 238, 243 (S.D. 1994) (superseded by statute). Lotteries on the other hand have been defined narrowly, including only those schemes where tickets are sold to a number of people and then a ticket is designated as the winner. Id. Even though labeled differently, these two things have common factors, namely prize, consideration, and chance. Id. at 244-45.

South Dakota uses the dominant factor test in determining when chance is present in a game or scheme. In Bayer v. Johnson, 349 N.W.2d 447, 449 (S.D. 1984), the court stated, “a game of chance is a contest whereon chance predominates over skill.” The court then applied this definition to bookmaking, and concluded that wagering on these events involved no skill. Id. Thus, the court held that bookmaking should be considered a game of chance. Id.

II. Definition of Bookmaking

Although there is no statute that explicitly identifies bookmaking as an illegal offense in South Dakota, the case of Bayer v. Johnson, 349 N.W.2d 447 (S.D. 1984) defines bookmaking and labels it as an illegal game of chance. The court stated that bookmaking involved “a bookmaker receives wagers from players, or customers, the outcome of which depends upon the happening of an uncertain event. The occurrence of the event determines which party, the player or the bookmaker, must pay the other an amount specified at the time the wager was placed.” Id. at 449. The court then mentioned that athletic events, horse races, and dog races were commonly the subject of bets taken in by a bookmaker. Id.

III. Gambling Devices

S.D. Codified Laws § 22-25-1 (2004) makes it illegal for anyone to engage in “gambling in any form with cards, dice, or other implements, or devices of any kind where anything valuable is wagered upon the outcome . . . .” With this broad definition, the court in Jasper v. Rossman, 41 N.W.2d 310, 312 (S.D. 1950), held that a punch board used for gaming purposes was a gambling device. In State v. White, 147 N.W. 264, 265 (S.D. 1914), the court held that cards, chips, and a table used in playing poker for gambling purposes was a gambling article.

S.D. Codified Laws § 22-25-13 (2004) also makes it illegal for anyone to have or keep a slot machine. A slot machine in South Dakota is defined as “any machine upon the action of which anything of value is staked and which is operated by placing therein or thereon any coins, checks, slugs, balls, chips, tokens, or other articles, or in any other manner as a result of such operation anything of value is won or lost by the operation of such machine, when the result of such operation is dependent upon chance.” S.D. Codified Laws § 22-25-13 (2004). This definition encompassed a video coupon machine that allowed individuals to purchase discount coupons for different business or products, as determined by the random calculation of the machine that made only certain coupons available. S.D. Op. Atty. Gen. Op. No. 90-48, 1990 WL 596816. Even just testing a slot machine in a manufacturing facility within the state is in violation of this section. S.D. Op. Atty. Gen. Op. No. 88-39, 1988 WL 483270.

However, this section does not extend to pinball machines that do not pay out money and arcade games or machine that award only free games. S.D. Codified Laws § 22-25-13 (2004). Also, if a slot machine is not used for gambling purposes and is over twenty-five years old, it is classified as an antique slot machine and is not illegal to keep or possess. S.D. Codified Laws § 22-25-14.1 (2004).

IV. Bucket Shops

There is no statutory provision prohibiting bucket shops in South Dakota. The only case dealing with Bucket shops in South Dakota dealt with a prohibition of bucket shops by the Minneapolis Chamber of Commerce. Hallet v. Aggergaard, 114 N.W. 696, 697 (S.D. 1908).

V. Prohibition of Games of Skill

1. Poker/Card Games

S.D. Codified Laws § 22-25-1 (2004) prohibits any form of gambling that uses cards. Because gambling in South Dakota is defined using the dominant factor test, it is necessary to evaluate how the courts in South Dakota have defined card games like poker and blackjack.

In City of Wessington Springs v. Melbourn, 249 N.W. 747, 748 (S.D. 1948), the court dealt with an appeal where an individual was charged with keeping a building where poker and other games of chance were played. The grouping of poker with games of chance indicates that South Dakota courts have classified poker as a game where chance predominates. This may be because of the random deal of the cards, which would prohibit almost all forms of card games where money is bet or wagered.

The court in Poppen v. Walker, 520 N.W.2d 238, 245 (S.D. 1994) (superseded by statute), stated that even with the dominant factor test used by South Dakota, the prohibition against gaming still extended to card games, video poker machines, and blackjack.

2. Dice Games

S.D. Codified Laws § 22-25-1 (2004) prohibits all forms of gambling that are done with the use of dice. Therefore, it seems that South Dakota courts have regarded the rolling of dice as a chance based activity that will outweigh the skill components that may also be present in a game.

The court in Poppen v. Walker, 520 N.W.2d 238, 245 (S.D. 1994) (superseded by statute), stated that even with the dominant factor test used by South Dakota, the prohibition of gaming still extended to dice games.

3. Billiards

There is no statutory provision or case law in South Dakota dealing with the game of billiards and gambling. However, with the utilization of the dominant factor test in South Dakota and the overwhelming skill components present in billiards, it is logical to assume that playing billiards for money or in a tournament form would be exempt from the gambling laws in the state of South Dakota. See Table Steaks v. First Premier Bank, N.A., 650 N.W.2d 829, 832 (S.D. 2002).

4. Bowling

There is no statutory provision or case law dealing with the game of bowling and gambling. However, with the utilization of the dominant factor test in South Dakota and the overwhelming skill components present in bowling, it is logical to assume that bowling for money or in a tournament form would be exempt from the gambling laws in the state of South Dakota.

5. Darts

There is no statutory provision or case law dealing with the game of darts and gambling. However, with the utilization of the dominant factor test in South Dakota and the overwhelming skill components present in darts, it is logical to assume that playing darts for money or in a tournament form would be exempt from the gambling laws in the state of South Dakota.

VI. Express exemptions

1. Social gambling

While many states would consider a pinball machine or other amusement device that awards free games to be in contravention of that state’s gambling laws, the state of South Dakota does not. Many states have held that free games constitute a prize because the amusement factor in being able to play multiple times beyond that which is paid for is something of value. However, S.D. Codified Laws § 22-25-13 (2004) explicitly provides an exemption for certain types of machines that have only free play features.

2. Charitable gaming

According to S.D. Const. Art. III, § 25 (1889), it is lawful for the South Dakota legislature to authorize “bona fide veterans, charitable, educational, religious or fraternal organizations, civic and service clubs, volunteer fire departments, or such other public spirited organizations as it may recognize, to conduct games of chance when the entire net proceeds of such games of chance are to be devoted to educational, charitable, patriotic, religious, or other public spirited uses.”

These organizations are allowed to conduct bingo or lotteries, which includes raffles, contingent on adherence to various provisions including:
1) no prizes over two thousand dollars can be awarded for a single game of bingo. S.D. Codified Laws § 22-25-25(5) (2004 & Supp. 2006). The lottery prize must be stated before any chances to participate in the lottery are sold. S.D. Codified Laws § 22-25-25(5A) (Supp. 2006).
2) before conducting one of these games or lotteries, the organization needs to give at least thirty days written notice of the time and place where these are to be held to the governing body of the county or municipality where the game is to be held. S.D. Codified Laws § 22-25-25(6) (2004 & Supp. 2006). If lottery tickets are to be sold statewide, then the organization needs to provide written notice to the secretary of state and to the governing body where the drawing is to be held. S.D. Codified Laws § 22-25-25(6) (2004 & Supp. 2006).
The state of South Dakota is very stringent on those that wish to be a distributor or manufacturer of bingo or lottery equipment in the state. Anyone that wishes to distribute or furnish this type of equipment is forced to pay five thousand dollars for a yearly license. S.D. Codified Laws § 22-25-28 (2004). A manufacturer of this equipment must obtain a yearly license, the fee that is set at two thousand five hundred dollars. S.D. Codified Laws § 22-25-29 (2004). Individuals or entities licensed as a manufacturer of this equipment cannot simultaneously be licensed as a distributor of this equipment as well. S.D. Codified Laws § 22-25-29 (2004). Also, those organizations that can actually conduct the game cannot be a licensed distributor or manufacturer of this equipment. S.D. Codified Laws § 22-25-32 (2004).
These licensed distributors and manufacturers can sell a coin-operated mechanical pull-tab dispensing device to a fraternal, charitable, or congressionally chartered veteran’s organization. S.D. Codified Laws § 22-25-41 (2004). The following characteristics of a pull-tab device may make it illegal for a distributor or manufacturer to possess or sell:
(1) In which the winning pull-tabs have not been completely and randomly distributed and mixed among all other pull-tabs in the deal;
(2) In which the location, or approximate location, of any of the winning pull-tabs can be determined in advance of opening the pull-tabs in any manner or by any device, including but not limited to, any pattern in the manufacture, assembly, or packaging of the pull-tabs by the manufacturer, by any marking on the pull-tabs or by the use of a light;
(3) Which does not conform in any respect to the requirements of this section, as to assembly, or packaging of pull-tabs;
(4) In which each individual pull-tab manufactured does not conspicuously set forth on it the name of the manufacturer or a label or trademark that identifies its manufacturer. S.D. Codified Laws § 22-25-46 (2004).

3. Commercial gaming/Slots

The operation of limited card games and slot machines is permitted in the City of Deadwood. S.D. Codified Laws § 42-7B-1 (2004). The South Dakota Commission on Gaming oversees these activities. S.D. Codified Laws § 42-7B-3 (2004). The following is a list of licensees that this Commission can grant to those that wish to conduct or be involved with commercial gaming:

1) Slot machine manufacturer or distributor. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year in the sum of two hundred fifty dollars. A slot machine manufacturer or distributor may not be licensed as a route operator, operator, or retailer;
(2) Operator license. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year of two hundred dollars;
(3) Retail license. The license fee is two hundred fifty dollars and thereafter an annual fee renewable July first of each year of one hundred dollars;
(4) Support license. The license fee is fifty dollars and thereafter an annual fee renewable January first of each year of twenty-five dollars. This license is required by all persons seeking employment in the field of gaming;
(5) Key employee license. The license fee is one hundred fifty dollars and thereafter an annual fee renewable January first of each year of seventy-five dollars;
(6) Route operator license. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year of two hundred dollars. Each route operator shall also hold a valid operator license. S.D. Codified Laws § 42-7B-22 (2004).

5. Chucky Cheese Exemption

There is no express exemption concerned with family entertainment centers or redemption slot machines that award tokens or credits that can be redeemed for small pieces of merchandise. However, pinball machines and arcade amusement devices that distribute only free games are allowed in South Dakota. S.D. Codified Laws § 22-25-13 (2004).

6. State lottery

The South Dakota Lottery Commission oversees the state lottery in South Dakota. S.D. Codified Laws § 42-7A-2 (2004). Among its many duties, the commission is in charge of selecting lottery retailers. S.D. Codified Laws § 42-7A-10 (2004). However, potential retailers must submit an application and a yearly application fee to be considered for such a right. S.D. Codified Laws § 42-7A-11 (2004). To be qualified as a lottery retailer, a natural person acting as a sole proprietor shall:

(1) Be at least eighteen years of age;
(2) Be of good character and reputation;
(3) Have sufficient financial resources to support the activities required to sell lottery tickets or place and service video lottery machines; and
(4) Be current in payment of all taxes, interest, and penalties owed to the State of South Dakota, excluding items under formal dispute or appeal pursuant to applicable statutes.

A lottery retailer or video lottery machine operator may not be a lottery vendor or an employee or agent of any lottery vendor doing business with the South Dakota Lottery. S.D. Codified Laws § 42-7A-13 (2004). A partnership or corporation that wishes to act, as a retailer must meet the third and fourth qualifications listed above, and each individual partner must meet qualifications one and two. S.D. Codified Laws § 42-7A-15 (2004) & S.D. Codified Laws § 42-7A-16 (2004).

South Dakota also allows licensed bars and lounges (defined in this section as an “enterprise primarily maintained and operated for the selling, dispensing, and consumption of alcoholic beverages on the premises and may also include the sale and service of food.”) to have and operate video lottery machines on its premises. S.D. Codified Laws § 42-7A-37.1 (2004). These machines are defined in S.D. Codified Laws § 42-7A-1(18) (2004) as electronic video chance games where the player may receive free games or credits redeemable for cash, but not cash directly from the machine. S.D. Codified Laws § 42-7A-37.1 (2004). The requirements for a licensed video lottery machine listed in S.D. Codified Laws § 42-7A-37 (2004) are vast and include:

1) Shall offer only games licensed by the South Dakota Lottery and authorized by the commission;
(2) May not have any means of manipulation that affect the random probabilities of winning a video lottery game;
(3) Shall have one or more mechanisms that accept coins or cash in the form of bills. The mechanisms shall be designed to prevent obtaining credits without paying by stringing, slamming, drilling, or other means. If such attempts involve physical tampering, the machine shall suspend itself from operation until reset;
(4) Shall have non-resettable meters housed in any readily accessible locked machine area that keep a permanent record of all cash inserted into the machine, all refunds of winnings made by the machine’s printer, credits played for video lottery games, and credits won by video lottery players;
(5) Shall be capable of printing a ticket voucher stating the value of the prize for the player at the completion of each video lottery game; the time of day in a twenty-four hour format showing hours and minutes; the date; the machine serial number; the sequential number of the ticket vouchers; and an encrypted validation number from which the validity of the prize may be determined;
(6) Shall have accounting software that keeps an electronic record which includes, but is not limited to the following: total cash inserted into the machine; the value of winning tickets claimed by players; the total video lottery credits played and the total video lottery credits awarded by a video lottery game; and the payback percentage credited players of each video lottery game;
(7) Shall be linked under a central communications system to provide auditing program information as approved by the commission. The communications system shall be installed and all testing conducted no later than December 1, 1989. Until such time, all accounting of machine transactions shall be audited by electronic records maintained by each video lottery machine as required in subdivision (6) of this section. In no event may the communications system approved by the commission limit participation to only one manufacturer of video lottery machines by either the cost in implementing the necessary program modifications to communicate or the inability to communicate with the central communications system. Nothing in this section may be construed as requiring a machine that only offers video lottery games to be on-line or in constant communication with a central computer.Each licensed establishment cannot have more than ten of these machines on its premises. S.D. Codified Laws § 42-7A-44 (2004). These machines can only be played by those twenty-one years of age or older. S.D. Codified Laws § 42-7A-44 (2004). The hours when these machines can be operated are limited to the legal hours of operation allowed for the on-sale consumption of alcoholic beverages at such an establishment. S.D. Codified Laws § 42-7A-48 (2004).

South Dakota requires that its video lottery machine manufacturers, distributors, operators, and establishment licensees pay an annual fee for a license. S.D. Codified Laws § 42-7A-41 (2004). S.D. Codified Laws § 42-7A-41 (2004) lists the fees for each respective license:

1) Video lottery machine manufacturer--$5,000;
(2) Video lottery machine distributor--$5,000;
(3) Video lottery machine operator--the greater of $1,000 or $100 per machine licensed; and
(4) Video lottery establishment--$100.

In addition to the annual license fees, the executive director may charge a one-time license application fee not to exceed fifty dollars.

6. Horse and dog racing

The South Dakota Commission on Gaming oversees all the horse and dog racing activity in South Dakota. S.D. Codified Laws § 42-7-56 (2004 & Supp. 2006). The commission is in charge of many things, including licensing those that wish to hold race meetings under the certificate system and setting the number of days that a licensee can conduct live racing. S.D. Codified Laws § 42-7-56 (2004 & Supp. 2006) & S.D. Codified Laws § 42-7-68 (2004).

S.D. Codified Laws § 42-7-58.1 (2004) gives the commission the power to allow licensees to collect and disburse money bet on racing at locations other than where the races are conducted, provided that these satellite locations are more than fifty miles away from any pari-mutuel racing track. However, if the owner of a horse or dog track within that file mile radius assents to such a satellite location, it can be established within that area as well. S.D. Codified Laws § 42-7-58.1 (2004).

S.D. Codified Laws § 42-7-58.2 (2004) allows licensed faculties to simulcast races from another licensed jurisdiction, and allows wagering on such races. However, the licensee must give written notice at least seven days prior to the race to be televised. S.D. Codified Laws § 42-7-58.2 (2004). The commission also requires that there be a signed reciprocal agreement between the South Dakota racetrack and the track where the race is held. S.D. Codified Laws § 42-7-58.2 (2004).

VII. Specific Internet Prohibition

South Dakota is one of the few states in the United States that has advanced a state statute concerned with Internet Gambling. Besides the South Dakota Lottery or the South Dakota Commission and its licensees, no person can establish a location or site in the state from which they conduct a gambling business over the internet or interactive computer service. S.D. Codified Laws § 22-25A-8 (2004). Also, no person engaged in a gambling business may use the internet to bet or wager upon the result of a yet to be determined event. S.D. Codified Laws § 22-25A-7 (2004).

VIII. Commercial gaming

1. Games Permitted and Prohibited

Throughout the section dealing with commercial gaming, it is stated that the City of Deadwood permits limited card games and slot machines to be conducted within the city limits. S.D. Codified Laws § 42-7B-3 (2004). Defined in S.D. Codified Laws § 42-7B-4(14) (2004), the term limited card games and slot machines means “any card games including poker and blackjack and slot machines authorized by this chapter and regulated by the commission.” The types of poker allowed include draw, stud, low ball, or any combination thereof. S.D. Codified Laws § 42-7B-4(18) (2004).

2. Limits-what are the limits on bet size, payouts, loss limits, etc.

According to S.D. Codified Laws § 42-7B-14 (2004), the maximum amount of a bet allowed on all games is the maximum bet limit-one hundred dollars-allowed for blackjack in South Dakota.

S.D. Codified Laws § 42-7B-36 (2004) states that the “minimum payback value of one credit played on a slot machine shall be at least eighty percent of the value of the credit.”

3. Fees and taxes

a. Fees

According to S.D. Codified Laws § 42-7B-21 (2004), the commission may establish an application fee which includes the cost of investigation and administration. This fee is nonrefundable. S.D. Codified Laws § 42-7B-21 (2004).

Obviously, there are multiple licenses required to conduct commercial gaming under this chapter. The following is a list of some of those licenses, as well as the fees that may be imposed:

(1) Slot machine manufacturer or distributor. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year in the sum of two hundred fifty dollars. A slot machine manufacturer or distributor may not be licensed as a route operator, operator, or retailer;
(2) Operator license. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year of two hundred dollars;
(3) Retail license. The license fee is two hundred fifty dollars and thereafter an annual fee renewable July first of each year of one hundred dollars;
(4) Support license. The license fee is fifty dollars and thereafter an annual fee renewable January first of each year of twenty-five dollars. All persons seeking employment in the field of gaming require this license;
(5) Key employee license. The license fee is one hundred fifty dollars and thereafter an annual fee renewable January first of each year of seventy-five dollars;
(6) Route operator license. The license fee is one thousand dollars and thereafter an annual fee renewable July first of each year of two hundred dollars. Each route operator shall also hold a valid operator license. S.D. Codified Laws § 42-7B-22(2004).

There is also an annual license stamp fee for each gaming device in the licensed facility. S.D. Codified Laws § 42-7B-23 (2004). The annual fee for each stamp is two thousand dollars. S.D. Codified Laws § 42-7B-23 (2004). Each machine must be stamped, but they can be transferred between machines or other operators without facing an additional fee if the commission approves of such a practice. S.D. Codified Laws § 42-7B-23 (2004).

b. Taxes

S.D. Codified Laws § 42-7B-28 (2004) imposes an eight percent gaming tax on the adjusted gross proceeds of allowed gaming. Adjusted gross proceeds means gross proceeds less cash prizes. S.D. Codified Laws § 42-7B-4(1) (2004). In the game of poker, this term means “any sums wagered in a poker hand which may be retained by the licensee as compensation which must be consistent with the minimum and maximum amount established by the South Dakota Commission on Gaming.” S.D. Codified Laws § 42-7B-4(1) (2004).

c. Operational requirements, hours, advertising, entertainment, exclusion, gambling age, mandatory exclusions, discretionary exclusions, voluntary exclusions by problem gamblers

Operational requirements

General provisions

Before a license can be approved, the commission must be given a retail floor plan, which shows the location of every gaming device to be included on the premises. S.D. Codified Laws § 42-7B-18 (2004).

S.D. Codified Laws § 42-7B-15 (2004) mandates that commercial gaming facilities post specific rules for each form of blackjack and poker game played in the facility and that these rules be posted within view of the tables where these games are conducted.

S.D. Codified Laws § 42-7B-16 (2004) limits the number of limited card games and slot machines to thirty per license or less.

Licenses

To obtain an operator or retailer license, a person must be at least twenty-one years of age and be of good moral character. S.D. Codified Laws § 42-7B-25 (2004). The applicant has the burden of proving all these qualifications to the commission. S.D. Codified Laws § 42-7B-19 (2004). Furthermore, those wishing to have a manufacturer, operator, retailer, or key employee or support license must be:

(1) A person of good character, honesty, and integrity;
(2) A person whose prior activities, criminal record, reputation, habits, and associations do not pose a threat to the public interests of this state or to the control of the gaming, or create or enhance the dangers of unsuitable, unfair, or illegal practices, methods, and activities in the conduct of gaming or the carrying on of the business and financial arrangements incidental to the conduct of gaming;
(3) A person who has not entered a plea of guilty or nolo contendere to a felony charge or has not been convicted of a felony in this or any other jurisdiction, has not been found to have violated the provisions of this chapter or any rule adopted pursuant to this chapter, and has not knowingly made a false statement of material facts to the commission or its legal counsel.

S.D. Codified Laws § 42-7B-33 (2004).

Hours

There is no statutory provision regulating the hours these commercial gaming facilities can operate.

Advertising

There is no statutory provision regulating gaming advertisements shown in the State of South Dakota.

Entertainment

There is no statutory provision regulating the entertainment that can take place in commercial gaming facilities in South Dakota.

Exclusion

The commission is allowed to make a list of persons to be excluded from licensed gaming establishments, including any person who poses a threat to the interest of the state, or to licensed gaming, or both. S.D. Codified Laws § 42-7B-61 (2004). In making the list, the commission is allowed to factor in:

(1) Prior conviction of a felony, a misdemeanor involving moral turpitude or a violation of the gaming laws of any state, the United States, any of its possessions or territories including Indian tribes;
(2) A violation, attempt to violate or conspiracy to violate the provisions of this chapter relating to the failure to disclose an interest in a gaming establishment for which the person must obtain a license or make disclosures to the commission; or intentional evasion of fees or taxes;
(3) Notorious or unsavory reputation that would adversely affect public confidence and trust that the gaming industry is free from criminal or corruptive influences.

S.D. Codified Laws § 42-7B-61 (2004). If placed on the list, the excluded individual must be given notice by personal service, by certified or registered mail to the last known address of the person, or by publication in an official newspaper in Lawrence County. S.D. Codified Laws § 42-7B-62 (2004).

Gambling age

To participate in the limited card games and slot machines authorized in a licensed gaming establishment, a person must be twenty-one years old or older. S.D. Codified Laws § 42-7B-35 (2004). Any gaming employee of the establishment must also be at least twenty-one years of age. S.D. Codified Laws § 42-7B-27 (2004).

Problem gamblers

The Commission can give up to thirty thousand dollars a year to the Department of Human Services to fund gaming addiction treatment and counseling programs in the state. S.D. Codified Laws § 42-7B-48.3 (Supp. 2006).

d. Gaming Contracts

S.D. Codified Laws § 42-7B-64 (2004) defines a gaming contract as:

For the purposes of this chapter, a gaming contract is any contract between licensees, and also a contract between a licensee and a no licensee which directly or indirectly relates to the employment of licensed personnel, which relates to the acquisition or use of capital assets used by the licensee in the business of gaming, or which relates to the earnings or profits of the licensee from the business of gaming, or any other contract which affects the proprietary or financial interest of the licensee’s gaming business or gaming license. A person must submit copies of all proposed gaming contracts to the executive secretary, the head of the gaming commission in South Dakota. S.D. Codified Laws § 42-7B-66 (2004). The executive secretary can then approve or deny these contractors or require that parts of them be changed or altered. S.D. Codified Laws § 42-7B-66 (2004).

e. Commercial gaming crimes

There is a variety of commercial gaming crimes that could be levied on the operators of these licensed gaming establishments, including those persons that:

(1) Makes any false or fraudulent return in attempting to defeat or evade the tax imposed by this chapter guilty of a Class 6 felony;
(2) Fails to pay tax due under this chapter within thirty days from the date the tax becomes due is guilty of a Class 1 misdemeanor;
(3) Fails to file a return required by this chapter within thirty days from the date the return is due is guilty of a Class 1 misdemeanor;
(4) Violates either subdivision (2) or subdivision (3) two or more times in any twelve-month period is guilty of a Class 6 felony. S.D. Codified Laws § 42-7B-30 (2004).

Also, if a license is suspended, revoked for any cause or for violation by the licensee or their employee, these following monetary punishments can apply:

(1) If the licensee is a slot machine manufacturer distributor, the amount of one hundred thousand dollars;
(2) If the licensee is an operator, the amount of twenty-five thousand dollars;
(3) If the licensee is a retailer, the amount of twelve thousand five hundred dollars;
(4) If the licensee is a key employee, the amount of five thousand dollars; and
(5) If the licensee has a support license, the sum of two thousand five hundred dollars. S.D. Codified Laws § 42-7B-32 (2004).

No licensee or employee of the licensee acting within the scope of their employment can extend credit to another for participation in gaming activity. S.D. Codified Laws § 42-7B-45 (2004). Violation of this statute is a class 6 felony. S.D. Codified Laws § 42-7B-45 (2004).

There are many criminal provisions for those individuals only frequenting a licensed gaming establishment in South Dakota. For instance, anyone that participates in gaming at one of these facilities under the age of twenty-one is guilty of a class 1 misdemeanor. S.D. Codified Laws § 42-7B-35 (2004). Also, those licenses that permit this underage activity are also guilty of a Class 1 misdemeanor and this may be cause for revocation of their retail license. S.D. Codified Laws § 42-7B-35 (2004).

Also, anyone that does any of the below-listed acts is guilty of a class 5 felony:

(1) Use bogus or counterfeit chips, tokens, devices, or coins;
(2) Employ or have on one’s person any cheating device to facilitate cheating in any game of chance;
(3) Use any fraudulent scheme or technique;
(4) Have located on the premises equipment for gaming that is not licensed by the commission under this chapter except equipment exempted by the commission, this chapter or other statutes.

S.D. Codified Laws § 42-7B-42 (2004).

IX. Gaming Crimes

1. Gaming Crimes

S.D. Codified Laws § 22-25-1 (2004) states that any person who engages in gambling or anyone who keeps or knowingly permits a place or equipment for such gambling is guilty of a Class 2 misdemeanor. By this language, it is easy to see that this section applies to mere players who just engage in gambling as well as the operators/owners of the premises where this gambling is taking place.

It is a petty offense to conduct racing between animals for bet, stake, or reward, except as authorized in the statutes. S.D. Codified Laws § 22-25-6 (2004).

Anyone that keeps or possesses slot machines is guilty of a class 1 misdemeanor. S.D. Codified Laws § 22-25-13 (2004). That section only applies to those that keep these machines, not those that just use the machine.

Anyone that conducts bingo without authorization is guilty of a class 2 misdemeanor. S.D. Codified Laws § 22-25-26 (2004). This section applies only to those individuals that conduct the unauthorized bingo game, not those that may just play it.

Those that operate a gambling business in the state or that use the internet to bet or wager are guilty of class 6 felony for the first offense. S.D. Codified Laws § 22-25A-10(1) (2004). Each later offense is considered a class 5 felony. S.D. Codified Laws § 22-25A-10(2) (2004).

2. State Lottery crimes

Anyone seeking to enter in a contract with the state to supply lottery-related materials that tries to give a member of the lottery commission or a member of their household money or gifts having a total aggregate value of over one hundred dollars in any one calendar year is guilty of a class 1 misdemeanor. S.D. Codified Laws § 42-7A-28 (2004).

Anyone that falsely makes counterfeit lottery tickets, alters, forges, passes, or counterfeits a South Dakota Lottery ticket is guilty of a class 6 felony. S.D. Codified Laws § 42-7A-30 (2004). This section only applies to those that do the counterfeiting, not those that may purchase or receive the counterfeit ticket.

Selling a lottery ticket to a person under the age of eighteen is illegal and if found guilty, an individual is charged with a class 1 misdemeanor. S.D. Codified Laws § 42-7A-32 (2004). This section applies not to those underage individuals that may receive the ticket, but just to those that sell them the ticket. However, a lottery ticket can be given as a gift to someone under the age of eighteen, provided that if they win the award is paid to the person’s parent or legal guardian. S.D. Codified Laws § 42-7A-32 (2004).

Also, no person can purchase a lottery tickets if they are married to or a member of the same household of any one that is a member of the commission of the South Dakota Lottery, or any officer or employee of a business which is current engaged in supplying equipment to be used in the operation of the state lottery. S.D. Codified Laws § 42-7A-33 (2004). Anyone found guilty of this section is guilty of a class 1 misdemeanor for the first offense and a class 6 felony for any later offense. S.D. Codified Laws § 42-7A-33 (2004). However, if the executive director of the lottery commission authorizes it in writing, he or she can provide an exception for these individuals prohibited by this section. S.D. Codified Laws § 42-7A-33 (2004).

Anyone that tampers with a video lottery machine with the intent to interfere with its operation is guilty of a class 1 misdemeanor. S.D. Codified Laws § 42-7A-46 (2004).

Anyone that tampers with the intent to manipulate the outcome or payoff of one of these machines is guilty of a class 5 felony. S.D. Codified Laws § 42-7A-47 (2004).

Anyone that plays the video lottery machines that is under the age of twenty-one is guilty of a class 2 misdemeanor. S.D. Codified Laws § 42-7A-48 (2004).

3. Racing Crimes

Anyone that conducts a racing meeting or tries to collect or distribute money under the certificate system without a license is guilty of a class 1 misdemeanor. S.D. Codified Laws § 42-7-57 (2004).

Anyone other than a licensee that accepts bets over two hundred on the outcome of a horse or dog race is guilty of a class 6 felony. S.D. Codified Laws § 42-7-76.1 (2004).

If the bet is one hundred to two hundred dollars the person is guilty of a class 1 misdemeanor. S.D. Codified Laws § 42-7-76.2 (2004). If the bet is less than one hundred dollars, the person is guilty of a class 2 misdemeanor. S.D. Codified Laws § 42-7-76.3 (2004).

According to S.D. Codified Laws § 21-6-1 (2004).

Any person who shall lose any thing of value at any game, or by betting on any game, may recover the same or the value thereof from any other person playing at the game at which such thing was lost, or from the person with whom the bet was made, or from the proprietor of the place where the game was played, in a civil action, in which such proprietor and all persons engaged in the game may be joined as parties; provided that such action shall have been commenced within six months after the date of such loss.The court in Morrow v. Quinn-Shepherdson Co., 205 N.W. 38, 39 (S.D. 1925), agreed with the jury in the lower court that the wife should recover most of the money that she gave her husband to pay off certain debts, but were actually used by the husband in various gambling transactions.