8.22.3802 REQUIREMENTS TO CONDUCT ADVANCE DEPOSIT ACCOUNT WAGERING
(1) The advance deposit wagering rules set forth in this chapter shall apply to the establishment and operation of accounts by a licensed hub operator for account holders whose principal residence address is in the state of Montana.
(2) Advance deposit wagering by any person whose principal residence address is in the state of Montana may be conducted only by a Montana-licensed hub operator licensed by the board pursuant to this chapter.
(3) No licensed hub operator shall solicit, accept, open, or operate an account for any person with a principal residence address in the state of Montana unless the hub operator has received a license in good standing from the board.
(4) The board may impose any license discipline, including suspension, revocation, or fines against a license to operate as a hub operator, if the licensed hub operator, its officers, directors, or employees violate any provision of Title 23, chapter 4, MCA, or any rule or order of the board.
(5) A licensed hub operator located within Montana shall not solicit, accept, open, or operate advance deposit wagering accounts for persons whose principal residence is outside of the state of Montana, including residents of foreign jurisdictions unless:
(a) the hub operator has received a license from the board, and the license is in good standing;
(b) wagering on that same type of live racing is lawful in the jurisdiction which is the person's principal residence; and
(c) the licensed hub operator complies with the provisions of the Interstate Horseracing Act, 15 U.S.C. 3001 to 3007, and the laws of the jurisdiction, which is the principal place of residence of the applicant.
(6) The licensed hub operator shall provide a bond or irrevocable letter of credit in an amount set by the board for the purpose of ensuring that payments to the board and to Montana account holders are made. In the alternative, a hub operator may provide other means of assurance of such payment including, but not limited to, evidence of bond(s), irrevocable letter(s) of credit, or other forms of financial guarantees posted and in good standing with regulatory authorities in other jurisdictions, which shall be subject to the approval of the board. Any bond, letter of credit, or other assurance of payment acceptable to the board provided by the hub operator shall run to the board as obligee, and shall be for the benefit of the board and any account holder who suffers a loss by reason of the hub operator's violation of Title 23, chapter 4, MCA, or these rules. The bond, letter of credit, or other assurance of payment shall be conditioned on the obligor as licensee faithfully complying with Title 23, chapter 4, MCA, and these rules. The bond shall be continuous and may be cancelled by the surety only upon the surety giving written notice to the board of its intent to cancel the bond. The notice of cancellation shall be effective no sooner than thirty days after the notice is received by the board. In the event of cancellation of the bond, letter of credit, or other assurance of payment the hub operator shall file a new bond, letter of credit, or other assurance of payment prior to the effective date of the cancellation notice.
(7) Persons whose primary residence is within Montana shall not participate in advance deposit wagering unless such activity is conducted through a hub operator licensed in Montana.
(8) The content and frequency of reports from a licensed hub operator shall be at the discretion of the board.
(9) In determining whether to approve an application for a license as an advance deposit wagering hub operator under this chapter, the board shall consider the following factors:
(a) the impacts on all entities conducting business as part of the Montana horse racing industry;
(b) whether the board deems the state compliance and monitoring efforts of the state where the licensed hub operator is located are sufficient for compliance with applicable laws, and for the protection of the public, and to ensure the integrity of all operations and financial transactions under the agreement between the board and the licensed hub operator; and
(c) any other factor the board identifies on the record as relevant to its determination.
(10) The hub operator licensee recognizes and accepts the jurisdiction of the state of Montana as provided in Title 23, chapter 4, MCA. A licensed hub operator shall provide to the board or its staff access to review and audit all records and financial information, including all Montana account information. An advance deposit wagering hub operator physically located in Montana shall also provide access to the board, or its staff, to review and audit all records and financial information that relate to applications and accounts for persons whose primary residences are not located in Montana. This information shall be made available to the board or its staff at the hub operator's location upon notice from the board or board staff at all reasonable times. The board may require the hub operator annually to submit to the board audited financial statements.