Yet another property raffle has had to be abandoned because it has been deemed illegal under Gambling Commission rules.
A Yorkshire couple, Robert and Avril Smith, announced in the autumn that they aimed to sell 60,000 tickets at £10 each.
The raffle was to have taken place in August this year - meaning tickets would have been on sale for almost a year - but shortly before the Christmas holidays the competition was suspended after the Gambling Commission ruling.
A message on the competition website shows the decision was taken in anger: “It is with sincere regret and upset that this competition has to close. The Gambling Commission has deemed the competition a potential lottery and not a legal prize competition. This is despite independent legal advice we obtained to the contrary. It is also after a period of over four months of silence from the Commission, despite being told of our competition on 30th July 2018.”
The website says those seeking a refund have to log in to an encrypted area of the site via a ‘claim refund’ button.
The Gambling Commission says there are two options for individuals or companies wishing to raffle a property - and repeated failure to abide by one or the other option could, at worst, lead to a year’s prison sentence.
Firstly an owner could run a raffle based purely on the luck-of-the-draw, providing he or she obtains a Gambling Commission licence.
The commission says such events cannot be run for private gain and cannot offer a prize valued above £200,000 (both limiting the attractiveness of a raffle for many home owners).
Secondly it is possible to hold a competition to dispose of a highly valuable prize such as a property but this needs to be convincingly “skills-based” rather than involve the random drawing of a ticket requiring nothing more than chance.
This latter point is why many raffles in recent years have been abandoned, with organisers believing they could simply publicise the property and sell tickets.
Back in 2008 when house prices were tumbling because of the financial crisis, the Gambling Commission closed down around 100 attempted raffles in just one year because they had no ‘skills’ requirement.