4-51-120 - Lottery retailers Fiduciary duty Protection against loss.
4-51-120. Lottery retailers Fiduciary duty Protection against loss.
(a) All proceeds from the sale of the lottery tickets or shares shall constitute a trust fund until paid to the corporation either directly or through the corporation's authorized collection representative. A lottery retailer and officers of a lottery retailer's business shall have a fiduciary duty to preserve and account for lottery proceeds and lottery retailers shall be personally liable for all proceeds. Proceeds shall include unsold instant tickets received by a lottery retailer and cash proceeds of the sale of any lottery products, net of allowable sales commissions and credit for lottery prizes sold to or paid to winners by lottery retailers. Sales proceeds and unused instant tickets shall be delivered to the corporation or its authorized collection representative upon demand.
(b) (1) Pursuant to § 4-51-105(a)(3), the corporation shall adopt and enforce policies designed to safeguard and limit the opportunity for loss of lottery proceeds that are not in the possession of the corporation. Such policies may include, but are not limited to:
(A) Requirements governing financial institutions into which retailers shall deposit lottery proceeds;
(B) Requirements for the establishment of separate accounts for the deposit of lottery proceeds by retailers;
(C) The timing of deposit of lottery proceeds by retailers; and
(D) The timing of withdrawal of funds from retailer accounts by the corporation.
(2) Any policies designed to safeguard and limit the opportunity for loss of lottery proceeds, and any revisions to such policies, shall be filed with the state funding board.
(c) Notwithstanding any provision of law to the contrary, whenever any person who receives proceeds from the sale of lottery tickets or shares in the capacity of a lottery retailer becomes insolvent or dies insolvent, the proceeds due the corporation from such person or that person's estate shall have preference over all debts or demands.
[Acts 2003, ch. 297, § 2.]