(1) The director shall issue, suspend, revoke, and
renew licenses for lottery sales agents pursuant to subsection (3) of this section
and rules adopted by the commission. Licensing rules shall include requirements
relating to the financial responsibility of the licensee, the accessibility of the
licensee's place of business or activity to the public, the sufficiency of existing
licenses to serve the public interest, the volume of expected sales, the character of
the licensee, the security and efficient operation of the lottery, the licensed agent
recovery reserve authorized in section 44-40-121, and other matters necessary to
protect the public interest and trust in the lottery and to further the sales of lottery
tickets or shares. Rules shall also require that licenses be prominently displayed in
areas visible to the public.
(2) (a) A license shall be revoked upon a finding that the licensee:
(I) Has provided false or misleading information to the division;
(II) Has been convicted of any gambling-related offense;
(III) Has endangered the security of the lottery;
(IV) Has become a person whose character is no longer consistent with the
protection of the public interest and trust in the lottery; or
(V) Has intentionally refused to pay a prize in his or her possession to a
person entitled to receive the prize under this article 40.
(b) A license may be suspended, revoked, or not renewed for any of the
following causes:
(I) A change of business location;
(II) An insufficient sales volume;
(III) A delinquency in remitting money owed to the lottery;
(IV) The endangering of the efficient operation of the lottery;
(V) Any violation of this article 40 or any rule adopted pursuant to this article
40; or
(VI) Conviction of any felony.
(3) Procedures for issuance, suspension, revocation, and renewal of licenses
shall be in accordance with article 4 of title 24, and the director shall have all the
powers and shall be subject to all the requirements of article 4 of title 24 in
conducting any hearings relating to the granting, suspension, revocation, or
renewal of licenses. When a felony conviction or a conviction involving fraud is an
issue in the issuance, suspension, revocation, or renewal of a lottery sales agent's
license, the director's determination shall be submitted to a three-member panel
who shall approve or reject the determination. The panel's decision shall constitute
final agency action for the purposes of section 24-4-106. The panel shall be
composed of the chairman of the lottery commission, the executive director, and
the secretary of state.
(4) Licensed sales agents may include persons, firms, associations, or
corporations, profit or nonprofit, but the following are ineligible for any license as a
sales agent:
(a) Any person who will engage in business exclusively as a lottery sales
agent;
(b) Any person who has been convicted of a gambling-related offense,
notwithstanding the provisions of section 24-5-101;
(c) Any person who is or has been a professional gambler or gambling
promoter;
(d) Any person who has engaged in bookmaking or any other form of illegal
gambling;
(e) Any person who is not of good character and reputation, notwithstanding
the provisions of section 24-5-101, in the community where he or she resides;
(f) Any person who has been convicted of a crime involving
misrepresentation, notwithstanding the provisions of section 24-5-101;
(g) Any firm or corporation in which a person defined in subsections (4)(b) to
(4)(f) of this section has a proprietary, equitable, or credit interest;
(h) Any organization in which a person defined in subsections (4)(b) to (4)(f)
of this section is an officer, director, or managing agent, whether compensated or
not; or
(i) Any organization in which a person defined in subsections (4)(b) to (4)(f) of
this section is to participate in the management or sales of lottery tickets or shares.
(5) Licensed sales agents may include persons, firms, associations, or
corporations, profit or nonprofit, but the following may be determined to be
ineligible for any license as a sales agent:
(a) Any person who has been convicted of a felony or a crime involving fraud,
notwithstanding the provisions of section 24-5-101;
(b) Any firm or corporation in which a person defined in subsection (5)(a) of
this section has a proprietary, equitable, or credit interest;
(c) Any organization in which a person defined in subsection (5)(a) of this
section is an officer, director, or managing agent, whether compensated or not; or
(d) Any organization in which a person defined in subsection (5)(a) of this
section is to participate in the management or sales of lottery tickets or shares.
(6) Each licensed sales agent shall keep a complete set of books of account,
correspondence, and all other records necessary to show fully the lottery
transactions of the licensee, all of which shall be open at all times during business
hours for the inspection and examination of the division or its duly authorized
representatives. The division may require any licensed sales agent to furnish the
information that the division considers necessary for the proper administration of
this article 40 and may require an audit to be made of the books of account and
records when the division considers necessary by an auditor, selected by the
director, who shall likewise have access to all the books and records of the
licensee, and the licensee may be required to pay the expense thereof.
(7) All licenses for lottery sales agents shall specify the place that sales
shall take place, and no license shall be effective upon residential premises.
(8) The costs of any investigation into the background of an applicant
seeking a license for a lottery sales agent shall be assessed against the applicant
and shall be paid by the applicant at the time of billing by the state. The
investigation may be conducted by the division or the attorney general.
Investigators shall have peace officer authority during the period of investigation.
(9) If there are more applications to operate lotto than there are outlets
available, then at least one hundred locations will be decided by a drawing by lot
with the balance of all lotto outlets to be located at the direction of the division.
Any person licensed as a lottery sales agent pursuant to the provision of this
section shall be eligible to enter into this drawing by lot to determine if the person
will be allowed to operate a lotto game at the same location.
(10) If the rental payments for the business premises of any lottery sales
agent are based in whole or in part on a percentage of retail sales, and the
computation of retail sales in the rental agreement does not specifically include the
sale of tickets or shares in the lottery, the compensation received by the sales
agent, as determined by the commission pursuant to section 44-40-109 (2)(h), and
not the gross revenues from the sale of lottery tickets or shares shall be the
amount of the retail sale for the purpose of computing the rental payment.
(11) (a) Each applicant for a lottery sales agent license, with the submission
of the application, shall submit a set of fingerprints to the division. The division shall
forward the fingerprints to the Colorado bureau of investigation for the purpose of
conducting a state and national fingerprint-based criminal history record check
utilizing records of the Colorado bureau of investigation and the federal bureau of
investigation. Only the actual costs of the record check shall be borne by the
applicant. Nothing in this subsection (11) shall preclude the division from making
further inquiries into the background of the applicant.
(a.5) When the results of a fingerprint-based criminal history record check of
an applicant performed pursuant to this subsection (11) reveal a record of arrest
without a disposition, the division shall require the applicant to submit to a name-based judicial record check, as defined in section 22-2-119.3 (6)(d).
(b) For purposes of this subsection (11), applicant means an individual or
each officer or director of a firm, association, or corporation that is applying for a
license pursuant to this section.