# 66 FR 66500: Minimum Internal Control Standards

> Federal · Regulations · In force

URL: https://www.frixlaw.com/law-library/statutes/FR_PRORULE_01-30788

## Section

- **Citation:** 66 FR 66500
- **Heading:** Minimum Internal Control Standards
- **Jurisdiction:** Federal
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Federal Register / Vol. 66 / 66 FR 66500

## Text

NATIONAL INDIAN GAMING COMMISSION 25 CFR Part 542 RIN 3141-AA24 Minimum Internal Control Standards AGENCY:
National Indian Gaming Commission.

ACTION:
Proposed rule.

SUMMARY:
In response to the inherent risks and the need for effective controls in tribal gaming operations, the Commission, in 1999, developed Minimum Internal Control Standards (MICS). Since their original implementation, it has become obvious that the MICS require technical adjustments and revisions so that they may continue to be effective in protecting tribal assets, while allowing tribes to utilize technological advances in the gaming industry. To that end, this proposed rule contains numerous revisions to the Commission's existing MICS that provide clarification of the rules and the flexibility to allow tribal gaming operations to make use of technological advances.

DATES:
Submit comments on or before February 25, 2002. At least one public hearing will be held during the comment period.

ADDRESSES:
Mail comments to Comments on Proposed Rule on MICS, National Indian Gaming Commission, 1441 L St., NW., Suite 9100, Washington, D.C. 20005, Attn.: Michele F. Mitchell. Comments may also be sent by facsimile to 202-632-7066.
FOR FURTHER INFORMATION CONTACT:
Joe H. Smith, 202-632-7003.

SUPPLEMENTARY INFORMATION:
Background
On January 5, 1999, the Commission first published its Minimum Internal Control Standards (MICS) as a Final rule. Since this time, as gaming tribes and the Commission gained practical experience with the MICS, it became apparent that some of the standards required clarification or modification to operate as the Commission had intended. Also recognizing the changes and advances in Indian gaming and gaming technology since implementation, on November 27, 2000, the Commission published an advanced notice of proposed rulemaking requesting public comments on the implementation of the MICS
ence with the MICS, it became apparent that some of the standards required clarification or modification to operate as the Commission had intended. Also recognizing the changes and advances in Indian gaming and gaming technology since implementation, on November 27, 2000, the Commission published an advanced notice of proposed rulemaking requesting public comments on the implementation of the MICS.
In keeping with its commitment to consultation and recognizing the government-to-government relationship it shares with tribes, the Commission solicited nominations of individuals interested in serving on an Advisory Committee designed to assist in revisiting the MICS. The ten tribal representatives were selected based on several factors, including the experiences and backgrounds of the individuals nominated, the sizes of their gaming operation(s), the types of games played at their gaming operation(s), and the areas of the country their gaming operation(s) are located. The selection process was a difficult one as numerous highly qualified individuals expressed an interest in serving on this important Committee. As expected, the value added by involving tribal representatives who work daily with the MICS was immeasurable.
Those participating on the behalf of tribes as members of this Advisory Committee were: Jamie Hummingbird, Director, Cherokee Nation Gaming Commission, Cherokee Nation; Patrick H. Lambert, Executive Director, Eastern Band of Cherokee Gaming Commission, Eastern Band of Cherokee; Stephen R. Lewis, Commissioner, Gila River Gaming Commission, Gila River Indian Community; Kristin L. Lumley, Executive Director, Yakama Nation Gaming Commission, Yakama Nation; John Monforte, Executive Director, Acoma Gaming Commission, Pueblo of Acoma; Lisa B. Otipoby, Director, Kaw Nation Enterprise Development Authority, Kaw Nation; Kevin F. O'Toole, Executive Director, Oneida Nation Gaming Commission, Oneida Nation of New York; Sandra Plawman, Treasurer, Ho-Chunk Nation Gaming Commission, Ho-Chuck Nation; Jerome J
ctor, Yakama Nation Gaming Commission, Yakama Nation; John Monforte, Executive Director, Acoma Gaming Commission, Pueblo of Acoma; Lisa B. Otipoby, Director, Kaw Nation Enterprise Development Authority, Kaw Nation; Kevin F. O'Toole, Executive Director, Oneida Nation Gaming Commission, Oneida Nation of New York; Sandra Plawman, Treasurer, Ho-Chunk Nation Gaming Commission, Ho-Chuck Nation; Jerome J. Schultze, Director, Morongo Gaming Agency, Morongo Band of Mission Indians; and Saunie K. Wilson, Executive Secretary, Oglala Sioux Tribal Gaming Commission, Oglala Sioux. The Advisory Committee also included the following Commission representatives: Teresa E. Poust, Commissioner; Joe H. Smith, Acting Director of Audits; Michele F. Mitchell, Attorney; Timothy B. Russ, Financial Analyst; and Denise Desiderio, Assistant to the Commission.
The Advisory Committee worked together as a team, guided by a Partnership Agreement developed at its first meeting. An important component of this Partnership Agreement was that decision-making would be done by consensus. Without concurrence from all Committee members on a proposed change, none would be made. As such, the proposed rule represents a series of compromises made by all members of the Advisory Committee after much discussion.
The Commission worked closely with the Advisory Committee to address their concerns about the existing MICS and to address the nearly one hundred comments received in response to the advanced notice of proposed rulemaking. Between May and November 2001, the Commission sponsored six working meetings. During these meetings, every clause of the existing MICS was reviewed and every comment submitted to the Commission was considered. Each meeting was held in a different region of the country, enabling visits to a number of tribal gaming operations. These visits provided valuable, first-hand experience with technological advances and concerns expressed during the comment period
ix working meetings. During these meetings, every clause of the existing MICS was reviewed and every comment submitted to the Commission was considered. Each meeting was held in a different region of the country, enabling visits to a number of tribal gaming operations. These visits provided valuable, first-hand experience with technological advances and concerns expressed during the comment period. Changes were made to the existing MICS based on comments, input from Advisory Committee members, and data gathered during site visits.
Public Comments and Comments From the Advisory Committee
Authority
Some public commenters and members of the Advisory Committee challenge the Commission's authority to promulgate this rule, particularly as it pertains to class III gaming. Members of the Advisory Committee agreed to participate in the process of revising the MICS, despite their position that the Commission may be without authority to promulgate minimum internal controls for class III gaming. The lengthy discussion regarding authority also included a discussion as to whether the MICS should be promulgated as recommended guidelines versus a mandatory rule. The Commission acknowledges that the participation of tribal representatives in this process does not in any way indicate concurrence in the Commission's determination that it does have the statutory authority to establish and enforce these regulations.
MICS Structure
Several commenters suggested that the Commission develop separate MICS for class II and class III gaming. Along these lines, several Advisory Committee members submitted proposals structuring the MICS so that the document itself was divided into class II and class III MICS. During consideration, a second alternative was discussed: that is, separating the MICS based upon tiers. A common complaint of tier A and B operations is that the existing MICS are confusing as to which requirements apply and which do not
hese lines, several Advisory Committee members submitted proposals structuring the MICS so that the document itself was divided into class II and class III MICS. During consideration, a second alternative was discussed: that is, separating the MICS based upon tiers. A common complaint of tier A and B operations is that the existing MICS are confusing as to which requirements apply and which do not. After extensive discussion, the Committee reached consensus on dividing the MICS along tier lines rather
The proposed rule is organized first by category of games, such as bingo, keno, and table games. As with the original rule, the proposed rule is not designed to classify the games into class II or class III. Rather, the MICS address the control issues related to the particular game, regardless of class. Pull tabs, for example, can be played as a class II or a class III game depending on the nature and circumstances of their play. Section 542.8 pertaining to pull tabs applies regardless of whether they are being played as class II or class III. Beginning with Subpart A, the proposed rule is then divided into subparts for each tier. Sections for each tier contain standards applicable only to the tier addressed. The Commission continues to believe that the most effective method of tailoring the MICS for class II and/or class III operations is through the tribal MICS as provided for in section 542.3(c) of this part. Each tribe will continue to adopt MICS that address the specific games that their operations offer.
Tier Structure
Much discussion centered on the specifics of the tier structure itself. Several members of the Advisory Committee submitted proposals adding an additional tier, subtracting an existing tier, or expanding the tier thresholds to an even greater extent than that which was eventually reached by consensus. The tier separation, which is based on annual gross gaming revenues, has been updated and expanded
uch discussion centered on the specifics of the tier structure itself. Several members of the Advisory Committee submitted proposals adding an additional tier, subtracting an existing tier, or expanding the tier thresholds to an even greater extent than that which was eventually reached by consensus. The tier separation, which is based on annual gross gaming revenues, has been updated and expanded. The Advisory Committee recognizes the positive benefits this action will have on a number of smaller gaming facilities.
Furthermore, an operation that moves from one tier to another will now have nine months from the date of the independent certified public accountant's audit report to achieve compliance with the requirements of the new tier. Previously, no time frame was specified. Changes have also been made throughout the proposed rule altering some of the requirements of the lowered tiered operations.
Recognizing the unique characteristics of the very small gaming operations, an exemption, similar to that for charitable gaming operations, has been extended to gaming operations with annual gross gaming revenues of less than $1 million. Subject to the approval of the Tribal gaming regulatory authority, such gaming operations would need not comply with the MICS as long as the Tribal gaming regulatory authority develops and the gaming operation complies with alternate procedures that protect the integrity of the games offered and safeguard the assets used in connection with the operation. The Advisory Committee asked that the ceiling of $1 million be periodically revisited. The Commission agrees to do so.
Technological Advances in Gaming
One of the most widely mentioned issues was that of technological advances in many areas of gaming. Many commenters felt that the MICS did not adequately address those areas in which new computer technology provides protections that are at least as safe as manual controls. The Committee and the Commission have attempted to address this issue in two ways
do so.
Technological Advances in Gaming
One of the most widely mentioned issues was that of technological advances in many areas of gaming. Many commenters felt that the MICS did not adequately address those areas in which new computer technology provides protections that are at least as safe as manual controls. The Committee and the Commission have attempted to address this issue in two ways. First, where necessary, specific sections of the MICS were modified to accommodate technological advances. Second, language was added to each section allowing use of computer applications that provide at least the level of control described by the standards in that section. Such usage would have to first be approved by the Tribal gaming regulatory authority. A variance would not be necessary, so long as the level of control required by the MICS is maintained.
Tribal Gaming Regulatory Authority
One of the terms used throughout the proposed rule is “Tribal gaming regulatory authority.” Tribes are responsible for the primary, day-to-day regulation of their operations, and the Committee and the Commission recognize that tribal governments have chosen different approaches of exercising their regulatory authority. A vast majority of tribes have implemented independent tribal gaming commissions, which in most cases the Commission believes to be the most effective way of ensuring the proper regulation of gaming operations. Alternate regulatory structures have also been developed, such as utilizing existing tribal governments, business, or economic development agencies, when determined to be more appropriate to the needs of the tribe. The term “Tribal gaming regulatory authority” is intended to refer to the tribally designated entity responsible for gaming regulation. In order to clarify the role of Tribal gaming regulatory authorities and recognize their immense value, the requirement that the Tribal gaming regulatory authority approve procedures implemented by gaming operation(s) has been added where appropriate
of the tribe. The term “Tribal gaming regulatory authority” is intended to refer to the tribally designated entity responsible for gaming regulation. In order to clarify the role of Tribal gaming regulatory authorities and recognize their immense value, the requirement that the Tribal gaming regulatory authority approve procedures implemented by gaming operation(s) has been added where appropriate.
Variances
Many comments were received on the variance process within the existing MICS. Some indicated confusion as to when a variance is required. Many commenters also questioned whether the Commission or the Tribal gaming regulatory authority should be issuing variances. This section has been restructured providing clarity and recognizing that the Tribal gaming regulatory authority should, in the first instance, determine whether a variance should be granted to a gaming operation. The Commission would then be requested to concur with the granted variance. If the Commission does not agree, it must justify its objection. The new process also allows for an appeal to the full Commission.
Some commenters requested that approved variances be published by the Commission. Because a variance is often based on intimate knowledge of the gaming operation and its procedures, a variance that works for one operation, because of additional factors known to the Tribal gaming regulatory authority, may not be sufficient to meet the control standard in another operation. These initial determinations are best made on an individual basis by tribal regulators who are most familiar with a gaming operation. However, to meet these concerns, the Commission will make variance concurrences available upon request, with the understanding that a variance continues to be applicable only to the operation for which it is granted.
Tribal-State Compacts
Members of the Committee requested clarification on the effect of the NIGC MICS on standards contained within a Tribal-State Compact
with a gaming operation. However, to meet these concerns, the Commission will make variance concurrences available upon request, with the understanding that a variance continues to be applicable only to the operation for which it is granted.
Tribal-State Compacts
Members of the Committee requested clarification on the effect of the NIGC MICS on standards contained within a Tribal-State Compact. Wording was put forth by Advisory Committee members that would require that the standards contained within a tribal-state compact take precedence over these MICS. The Commission was concerned that some compacts, while containing some internal control standards, may not adequately provide enough protection over Indian gaming operations. This section has been re-organized to reflect the Commission and Committee's understanding that this regulation contains minimum standards and does not require that Tribes adopt these exact standards, but that they adopt standards “at least as stringent as those set forth in this part.” Section 542.3(c)(1). The language contained in section 542.4 has been modified to reflect this ideal. Instead of requiring that a standard contained in a tribal-state compact be “more stringent than,” in order to be applicable, the requirement will now be
Accounting Standards
Information was presented to the Committee regarding the addition of accounting standards to the MICS. Data was reviewed from multiple gaming jurisdictions indicating that such standards are a typical element of a gaming regulatory framework. After much consideration, it was the Committee's consensus that the standards should be reserved for the Tribal gaming regulatory authorities to promulgate. Furthermore, it was recommended that the Commission provide guidance to the Tribes in the development of the standards and that such guidance be in the form of a bulletin
t such standards are a typical element of a gaming regulatory framework. After much consideration, it was the Committee's consensus that the standards should be reserved for the Tribal gaming regulatory authorities to promulgate. Furthermore, it was recommended that the Commission provide guidance to the Tribes in the development of the standards and that such guidance be in the form of a bulletin.
Regulatory Matters
Regulatory Flexibility Act
This rule will not have a significant economic effect on a substantial number of small entities as defined under the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. Indian Tribes are not considered to be small entities for the purposes of the Regulatory Flexibility Act.
Small Business Regulatory Enforcement Fairness Act
This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule does not have an annual effect on the economy of $100 million or more. This rule will not cause a major increase in costs or prices for consumers, individual industries, Federal, state or local government agencies or geographic regions and does not have a significant adverse effect on competition, employment, investment, productivity, innovation, or the ability of U.S. based enterprises to compete with foreign-based enterprises.
Unfunded Mandates Reform Act
The Commission has determined that this proposed rule does not impose an unfunded mandate on State, local or tribal governments or on the private sector of more than $100 million per year. Thus, it is not a “significant regulatory action” under the Unfunded Mandates Reform Act, 2 U.S.C. 1501 et seq. The Commission has determined that this proposed rule may have a unique effect on tribal governments, as this rule applies exclusively to tribal governments, whenever they undertake the ownership, operation, regulation, or licensing of gaming facilities on Indian lands as defined by the Indian Gaming Regulatory Act
nt regulatory action” under the Unfunded Mandates Reform Act, 2 U.S.C. 1501 et seq. The Commission has determined that this proposed rule may have a unique effect on tribal governments, as this rule applies exclusively to tribal governments, whenever they undertake the ownership, operation, regulation, or licensing of gaming facilities on Indian lands as defined by the Indian Gaming Regulatory Act. Thus, in accordance with section 203 of the Unfunded Mandates Reform Act, the Commission has developed a small government agency plan that provides tribal governments with adequate notice, opportunity for “meaningful” consultation, and information, advice and education on compliance.
The Commission's small government agency plan includes: request for public comment on changes needed; formation of a tribal advisory committee; discussions with Tribal leaders and tribal associations; preparation of guidance material and model documents; a public hearing; and technical assistance. During the period from May 2001 through November 2001, the Commission and the Tribal Advisory Committee met six times to develop a regulatory proposal. In selecting committee members, consideration was placed on the applicant's experience in this area, as well as the size of the tribe the nominee represented, geographic location of the gaming operation, and the size and type of gaming conducted. The Commission attempted to assemble a committee that incorporates diversity and is representative of Indian gaming interests. Since beginning formulation of this proposed rule, the Commission spoke at several tribal association meetings. The Commission will develop guidance materials that will include guidelines for CPA firms who must audit gaming operations to determine compliance with Tribal MICS. The Commission also plans to hold a public hearing on the proposed regulation prior to publication of a final rule
terests. Since beginning formulation of this proposed rule, the Commission spoke at several tribal association meetings. The Commission will develop guidance materials that will include guidelines for CPA firms who must audit gaming operations to determine compliance with Tribal MICS. The Commission also plans to hold a public hearing on the proposed regulation prior to publication of a final rule. The Commission will then meet again with the Tribal Advisory Committee to discuss the public comments that are received as a result of publication of this proposed rule and make a recommendation regarding the final rule. The Commission also plans on continuing its policy of providing technical assistance, through its field offices, to tribes to assist in complying with MICS.
Takings
In accordance with Executive Order 12630, the Commission has determined that this rule does not have significant takings implications. A takings implication assessment is not required.
Civil Justice Reform
In accordance with Executive Order 12988, the Office of General Counsel has determined that the rule does not unduly burden the judicial system and meets the requirements of sections 3(a) and 3(b)(2) of the Order.
Paperwork Reduction Act
This proposed regulation requires an information collection under the Paperwork Reduction Act 44 U.S.C. 3501 et seq. , as did the regulation it replaces. There is no change to the paperwork requirements created by this amendment. The Commission's OMB Control number for this regulation is 3141-0009.
National Environmental Policy Act
The Commission has determined that this proposed rule does not constitute a major Federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et. seq).
List of Subjects in 25 CFR Part 542
Accounting, Auditing, Gambling, Indian-lands, Indian-tribal government, Reporting and recordkeeping requirements
is proposed rule does not constitute a major Federal action significantly affecting the quality of the human environment and that no detailed statement is required pursuant to the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et. seq).
List of Subjects in 25 CFR Part 542
Accounting, Auditing, Gambling, Indian-lands, Indian-tribal government, Reporting and recordkeeping requirements.

For reasons stated in the preamble, the National Indian Gaming Commission proposes to revise 25 CFR Part 542 to read as follows:
PART 542—MINIMUM INTERNAL CONTROL STANDARDS
Subpart A—General
Sec. 542.1 What does this part cover? 542.2 What are the definitions for this part? 542.3 How do I comply with this part? 542.4 How do these regulations affect minimum internal control standards established in a Tribal-State compact? 542.5 How do these regulations affect state jurisdiction? 542.6 Does this part apply to small and charitable gaming operations? Subpart B—Gaming Operations
542.7 What are the minimum internal control standards for bingo? 542.8 What are the minimum internal control standards for pull tabs? 542.9 What are the minimum internal control standards for card games? 542.10 What are the minimum internal control standards for keno? 542.11 What are the minimum internal control standards for pari-mutuel wagering? 542.12 What are the minimum internal control standards for table games? 542.13 What are the minimum internal control standards for gaming machines? 542.14 What are the minimum internal control standards for the cage? 542.15 What are the minimum internal control standards for credit? 542.16 What are the minimum internal control standards for information technology? 542.17 What are the minimum internal control standards for complimentary services or items? 542.18 How does a gaming operation apply for a variance from these standards? Tier A Gaming Operations
542.20 What is a Tier A gaming operation? 542.21 What are the minimum internal control standards for drop and count for Tier A gaming opera
minimum internal control standards for information technology? 542.17 What are the minimum internal control standards for complimentary services or items? 542.18 How does a gaming operation apply for a variance from these standards? Tier A Gaming Operations
542.20 What is a Tier A gaming operation? 542.21 What are the minimum internal control standards for drop and count for Tier A gaming operations? 542.22 What are the minimum internal control standards for internal audit for Tier A gaming operations? 542.23 What are the minimum internal control standards for surveillance for Tier A gaming operations? Tier B Gaming Operations
542.30 What is a Tier B gaming operation? 542.31 What are the minimum internal control standards for drop and count for Tier B gaming operations? 542.32 What are the minimum internal control standards for internal audit for Tier B gaming operations? 542.33 What are the minimum internal control standards for surveillance for Tier B gaming operations? Tier C Gaming Operations
542.40 What is a Tier C gaming operation? 542.41 What are the minimum internal control standards for drop and count for Tier C gaming operations? 542.42 What are the minimum internal control standards for internal audit for Tier C gaming operations? 542.43 What are the minimum internal control standards for surveillance for a Tier C gaming operation? Authority:
25 U.S.C. 2702(2), 25 U.S.C. 2706(b)(10).
§ 542.1 What does this part cover? This part establishes the minimum internal control standards for gaming operations on Indian land.

§ 542.2 What are the definitions for this part? The definitions in this section shall apply to all sections of this part unless otherwise noted.
Account access card means an instrument used to access customer accounts for wagering at a gaming machine. Account access cards are used in connection with a computerized account database
ernal control standards for gaming operations on Indian land.

§ 542.2 What are the definitions for this part? The definitions in this section shall apply to all sections of this part unless otherwise noted.
Account access card means an instrument used to access customer accounts for wagering at a gaming machine. Account access cards are used in connection with a computerized account database.
Accountability means all items of cash, chips, coins, tokens, receivables, and customer deposits constituting the total amount for which the bankroll custodian is responsible at a given time.
Accumulated credit payout means credit earned in a gaming machine that is paid to a customer manually in lieu of a machine payout.
Actual hold percentage means the percentage calculated by dividing the win by the drop or coin-in (number of credits wagered). Can be calculated for individual tables or gaming machines, type of table games or gaming machines on a per day or cumulative basis.
Ante means a player's initial wager or predetermined contribution to the pot before the dealing of the first hand.
Bank or bankroll means the inventory of cash, coins, chips, checks, tokens, receivables, and customer deposits in the cage, pit area, gaming booths, and on the playing tables, and cash in bank which is used to make change, pay winnings, bets, and pay gaming machine jackpots.
Betting station means the area designated in a pari-mutuel area that accepts and pays winning bets.
Betting ticket means a printed, serially numbered form used to record the event upon which a wager is made, the amount and date of the wager, and sometimes the line or spread (odds).
Bill acceptor means the device that accepts and reads cash by denomination in order to accurately register customer credits at a gaming machine.
Bill acceptor canister means the box attached to bill acceptors used to contain cash received by bill acceptors
mbered form used to record the event upon which a wager is made, the amount and date of the wager, and sometimes the line or spread (odds).
Bill acceptor means the device that accepts and reads cash by denomination in order to accurately register customer credits at a gaming machine.
Bill acceptor canister means the box attached to bill acceptors used to contain cash received by bill acceptors.
Bill acceptor canister release key means the key used to release the bill acceptor canister from the bill acceptor device.
Bill acceptor canister storage rack key means the key used to access the storage rack where bill acceptor canisters are secured.
Bill acceptor drop means cash contained in bill acceptor canisters.
Bill-in meter means a meter included on a gaming machine accepting cash that tracks the number of bills put in the machine.
Boxman means the first-level supervisor who is responsible for directly participating in and supervising the operation and conduct of the craps game.
Breakage means the difference between actual bet amounts paid out by a racetrack to bettors and amounts won due to bet payments being rounded up or down. For example, a winning bet that should pay $4.25 may be actually paid at $4.20 due to rounding.
Cage means a secure work area within the gaming operation for cashiers and a storage area for the gaming operation bankroll.
Cage accountability form means an itemized list of the components that make up the cage accountability.
Cage credit means advances in the form of cash or gaming chips made to customers at the cage. Documented by the players signing an IOU or a marker similar to a counter check.
Cage marker form means a document, usually signed by the customer, evidencing an extension of credit at the cage to the customer by the gaming operation.
Calibration module means the section of a weigh scale used to set the scale to a specific amount or number of coins to be counted
made to customers at the cage. Documented by the players signing an IOU or a marker similar to a counter check.
Cage marker form means a document, usually signed by the customer, evidencing an extension of credit at the cage to the customer by the gaming operation.
Calibration module means the section of a weigh scale used to set the scale to a specific amount or number of coins to be counted.
Call bets means a wager made without cash or chips, reserved for a known patron and includes marked bets (which are supplemental bets made during a hand of play). For the purpose of settling a call bet, a hand of play in craps is defined as a natural winner (e.g., seven or eleven on the come-out roll), a natural loser (e.g., a two, three or twelve on the come-out roll), a seven-out, or the player making his point, whichever comes first.
Card game means a game in which the gaming operation is not party to wagers and from which the gaming operation receives compensation in the form of a rake, a time buy-in, or other fee or payment from a player for the privilege of playing.
Card room bank means the operating fund assigned to the card room or main card room bank.
Cash-out ticket means an instrument of value generated by a gaming machine representing a cash amount owed to a customer at a specific gaming machine. This investment may be wagered at other machines by depositing the cash-out ticket in the machine document acceptor.
Chips mean cash substitutes, in various denominations, issued by a gaming establishment and used for wagering.
Coin-in meter means the meter that displays the total amount wagered in a gaming machine that includes coins-in and credits played.
Coin meter count machine means a device used in a coin room to count coin.
Coin room means an area where coins and tokens are stored.
Coin room inventory means coins and tokens stored in the coin room that are generally used for gaming machine department operation.
Commission means the National Indian Gaming Commission
wagered in a gaming machine that includes coins-in and credits played.
Coin meter count machine means a device used in a coin room to count coin.
Coin room means an area where coins and tokens are stored.
Coin room inventory means coins and tokens stored in the coin room that are generally used for gaming machine department operation.
Commission means the National Indian Gaming Commission.
Complimentary means service or item provided to an individual for a legitimate business purpose.
Count means the total funds counted for a particular game, coin-operated gaming device, shift, or other period.
Count room means a room where the coin and cash drop from gaming machines, table games, or other games are transported to and counted.
Count team means personnel that perform either the count of the gaming machine drop and/or the table game drop.
Counter check means a form provided by the gaming operation for the customer to use in lieu of a personal check.
Credit means the right granted by a gaming operation to a patron to defer payment of debt or to incur debt and defer its payment.
Credit limit means the maximum dollar amount of credit assigned to a customer by the gaming operation.
Credit slip means a form used to record either:
(1) The return of chips from a gaming table to the cage; or
(2) The transfer of IOUs, markers, or negotiable checks from a gaming table to a cage or bankroll.
Customer deposits means the amounts placed with a cage cashier by customers for the customers' use at a future time.
Deal means a specific pull tab game in which each pull tab is numerically sequenced.
Dealer means an employee who operates a game, individually or as a part of a crew, administering house rules and making payoffs.
Dedicated camera means a video camera required to continuously record a specific activity.
Deskman means a person who authorizes payment of winning tickets and verifies payouts for keno games
a specific pull tab game in which each pull tab is numerically sequenced.
Dealer means an employee who operates a game, individually or as a part of a crew, administering house rules and making payoffs.
Dedicated camera means a video camera required to continuously record a specific activity.
Deskman means a person who authorizes payment of winning tickets and verifies payouts for keno games.
Document acceptor means the device integrated into each gaming machine that reads bar codes on coupons and cash-out tickets.
Draw ticket means a blank keno ticket whose numbers are punched out when balls are drawn for the game. Used to verify winning tickets.
Drop (for gaming machines) means the total amount of cash, cash-out tickets, or coupons removed from the drop bucket and bill acceptor canister.
Drop (for table games) means the total amount of cash and chips contained in the drop box, plus the amount of credit issued at the table.
Drop box means a locked container affixed to the gaming table into which the drop is placed. The game type, table number, and shift are indicated on the box.
Drop box contents keys means the key used to open drop boxes.
Drop box release keys means the key used to release drop boxes from tables.
Drop box storage rack keys means the key used to access the storage rack where drop boxes are secured.
Drop bucket means a container located in the drop cabinet (or in a secured portion of the gaming machine in coinless/cashless configurations) for the purpose of collecting coins, tokens, cash-out tickets, and coupons from the gaming machine.
Drop cabinet means the wooden or metal base of the gaming machine that contains the gaming machine drop bucket.
Earned and unearned take means race bets taken on present and future race events. Earned take means bets received on current or present events. Unearned take means bets taken on future race events.
EPROM means erasable programmable read-only memory or other equivalent game software media
cabinet means the wooden or metal base of the gaming machine that contains the gaming machine drop bucket.
Earned and unearned take means race bets taken on present and future race events. Earned take means bets received on current or present events. Unearned take means bets taken on future race events.
EPROM means erasable programmable read-only memory or other equivalent game software media.
Fill means a transaction whereby a supply of chips or coins and tokens is transferred from a bankroll to a table game, coin-operated gaming device, bingo or keno department.
Fill slip means a document evidencing a fill.
Flare means the information sheet provided by the manufacturer that sets forth the rules of a particular pull tab game and that is associated with a specific deal of pull tabs. The flare shall contain the following information:
(1) Name of the game;
(2) Manufacturer name or manufacturer's logo;
(3) Ticket count; and
(4) Prize structure, which shall include the number of winning pull tabs by denomination, with their respective winning symbols, numbers or both.
Future wagers means bets on races to be run in the future (e.g., Kentucky Derby).
Game server means an electronic selection device, utilizing a random number generator.
Gaming machine means an electronic or electromechanical machine which contains a microprocessor with random number generator capability which allows a player to play games of chance, some of which may be affected by skill, which machine is activated by the insertion of a coin, token or cash, or by the use of a credit, and which awards game credits, cash, tokens, or replays, or a written statement of the player's accumulated credits, which written statements be redeemable for cash.
Gaming machine analysis report means a report prepared that compares theoretical to actual hold by a gaming machine on a monthly or other periodic basis
activated by the insertion of a coin, token or cash, or by the use of a credit, and which awards game credits, cash, tokens, or replays, or a written statement of the player's accumulated credits, which written statements be redeemable for cash.
Gaming machine analysis report means a report prepared that compares theoretical to actual hold by a gaming machine on a monthly or other periodic basis.
Gaming machine booths and change banks means a booth or small cage in the gaming machine area used to provide change to players, store change aprons and extra coin, and account for jackpot and other payouts.
Gaming machine count means the total amount of coins, tokens, and cash removed from a gaming machine. The amount counted is entered on the Gaming Machine Count Sheet and is considered the drop. Also, the procedure of counting the coins, tokens, and cash or the process of verifying gaming machine coin and token inventory.
Gaming machine fill means the coins or tokens placed in a hopper.
Gaming machine pay table means the reel strip combinations illustrated on the face of the gaming machine that can identify payouts of designated coin amounts.
Gaming operation accounts receivable (for gaming operation credit) means credit extended to gaming operation patrons in the form of markers, returned checks, or other credit instruments that have not been repaid.
Gross gaming revenue means annual total amount of cash wagered on class II and class III games and admission fees (including table or card fees), less any amounts paid out as prizes or paid for prizes awarded.
Hold means the relationship of win to coin-in for gaming machines and win to drop for table games.
Hub means the person or entity that is licensed to provide the operator of a pari-mutuel wagering operation information related to horse racing which is used to determine winners of races or payoffs on wagers accepted by the pari-mutuel wagering operation
out as prizes or paid for prizes awarded.
Hold means the relationship of win to coin-in for gaming machines and win to drop for table games.
Hub means the person or entity that is licensed to provide the operator of a pari-mutuel wagering operation information related to horse racing which is used to determine winners of races or payoffs on wagers accepted by the pari-mutuel wagering operation.
Internal audit means individuals who perform an audit function of a gaming operation that are independent of the department subject to audit. Independence is obtained through the organizational reporting relationship as the internal audit department shall not report to management of the gaming operation. Internal audit activities should be conducted in a manner that permits objective evaluation of areas examined. Internal audit personnel may provide audit coverage to more than one operation within a Tribe's gaming operation holdings.
Issue slip means a copy of a credit instrument that is retained for numerical sequence control purposes.
Jackpot payout means the portion of a jackpot paid by gaming machine personnel. The amount is usually determined as the difference between the total posted jackpot amount and the coins paid out by the machine. May also be the total amount of the jackpot.
Lammer button means a type of chip that is placed on a gaming table to indicate that the amount of chips designated thereon has been given to the customer for wagering on credit before completion of the credit instrument. Lammer button may also mean a type of
Linked electronic game means any game linked to two (2) or more facilities that are physically separate.
Main card room bank means a fund of cash, coin, and chips used primarily for poker and pan card game areas. Used to make even cash transfers between various games as needed. May be used similarly in other areas of the gaming operation.
Marker means a document, usually signed by the customer, evidencing an extension of credit to him by the gaming operation
cilities that are physically separate.
Main card room bank means a fund of cash, coin, and chips used primarily for poker and pan card game areas. Used to make even cash transfers between various games as needed. May be used similarly in other areas of the gaming operation.
Marker means a document, usually signed by the customer, evidencing an extension of credit to him by the gaming operation.
Marker credit play means that players are allowed to purchase chips using credit in the form of a marker.
Marker inventory form means a form maintained at table games or in the gaming operation pit that are used to track marker inventories at the individual table or pit.
Marker transfer form means a form used to document transfers of markers from the pit to the cage.
Master credit record means a form to record the date, time, shift, game, table, amount of credit given, and the signatures or initials of the individuals extending the credit.
Master game program number means the game program number listed on a gaming machine EPROM.
Master game sheet means a form used to record, by shift and day, each table game's winnings and losses. This form reflects the opening and closing table inventories, the fills and credits, and the drop and win.
Mechanical coin counter means a device used to count coins that may be used in addition to or in lieu of a coin weigh scale.
Meter means an electronic (soft) or mechanical (hard) apparatus in a gaming machine. May record the number of coins wagered, the number of coins dropped, the number of times the handle was pulled, or the number of coins paid out to winning players.
MICS means minimum internal control standards in this part 542.
Motion activated dedicated camera means a video camera that, upon its detection of activity or motion in a specific area, begins to record the activity or area.
Multi-game machine means a gaming machine that includes more than one type of game option.
Multi-race ticket means a keno ticket that is played in multiple games
yers.
MICS means minimum internal control standards in this part 542.
Motion activated dedicated camera means a video camera that, upon its detection of activity or motion in a specific area, begins to record the activity or area.
Multi-game machine means a gaming machine that includes more than one type of game option.
Multi-race ticket means a keno ticket that is played in multiple games.
On-line gaming machine monitoring system means a system used by a gaming operation to monitor gaming machine meter reading activity on an online basis.
Order for credit means a form that is used to request the transfer of chips or markers from a table to the cage. The order precedes the actual transfer transaction that is documented on a credit slip.
Outstation means areas other than the main keno area where bets may be placed and tickets paid.
Par percentage means the percentage of each dollar wagered that the house wins (i.e., gaming operation advantage).
Par sheet means a specification sheet for a gaming machine that provides machine hold percentage, model number, hit frequency, reel combination, number of reels, number of coins that can be accepted and reel strip listing.
Pari-mutuel wagering means a system of wagering on horse races, jai-alai, greyhound and harness racing, where the winners divide the total amount wagered, net of commissions and operating expenses, proportionate to the individual amount wagered.
Payment slip means that part of a marker form on which customer payments are recorded.
Payout means a transaction associated with a winning event.
PIN means the personal identification number used to access a player's account.
Pit podium means a stand located in the middle of the tables used by gaming operation supervisory personnel as a workspace and a record storage area.
Pit supervisor means the employee who supervises all games in a pit
ch customer payments are recorded.
Payout means a transaction associated with a winning event.
PIN means the personal identification number used to access a player's account.
Pit podium means a stand located in the middle of the tables used by gaming operation supervisory personnel as a workspace and a record storage area.
Pit supervisor means the employee who supervises all games in a pit.
Player tracking system means a system typically used in gaming machine departments that can record the gaming machine play of individual patrons.
Post time means the time when a pari-mutuel track stops accepting bets in accordance with rules and regulations of the applicable jurisdiction.
Primary and secondary jackpots means promotional pools offered at certain card games that can be won in addition to the primary pot.
Progressive gaming machine means a gaming machine, with a payoff indicator, in which the payoff increases as it is played (i.e., deferred payout). The payoff amount is accumulated, displayed on a machine and will remain until a player lines up the jackpot symbols that result in the progressive amount being paid.
Progressive jackpot means deferred payout from a progressive gaming machine.
Progressive table game means table games that offer progressive jackpots.
Promotional payout means merchandise or awards given to players by the gaming operation based on a winning event.
Promotional progressive pots and/or pools means funds contributed to a table game by and for the benefit of players. Funds are distributed to players based on a predetermined event.
Rabbit ears means a device, generally V-shaped, that holds the numbered balls selected during a keno or bingo game so that the numbers are visible to players and employees.
Rake means a commission charged by the house for maintaining or dealing a game such as poker.
Rake circle means the area of a table where rake is placed.
Random number generator means a device that generates numbers in the absence of a pattern
vice, generally V-shaped, that holds the numbered balls selected during a keno or bingo game so that the numbers are visible to players and employees.
Rake means a commission charged by the house for maintaining or dealing a game such as poker.
Rake circle means the area of a table where rake is placed.
Random number generator means a device that generates numbers in the absence of a pattern. May be used to determine numbers selected in various games such as keno and bingo. Also commonly used in gaming machines to generate game outcome.
Reel symbols means symbols listed on reel strips of gaming machines.
Rim credit means extensions of credit that are not evidenced by the immediate preparation of a marker and does not include call bets.
Runner means a gaming employee who transports chips/cash to and from a gaming table to a cashier.
SAM means a screen-automated machine used to accept pari-mutuel wagers. SAM's also pay winning tickets in the form of a voucher, which is redeemable for cash.
Shift means an eight-hour period, unless otherwise approved by the Tribal gaming regulatory authority, not to exceed twenty-four (24) hours.
Shill means an employee financed by the house and acting as a player for the purpose of starting or maintaining a sufficient number of players in a game.
Short pay means a payoff from a coin-operated gaming device that is less than the listed amount.
Soft count means the count of the contents in a drop box or a bill acceptor canister.
Sufficient clarity means use of monitoring and recording at a minimum of twenty (20) frames per second. Multiplexer tape recordings are insufficient to satisfy the requirement of sufficient clarity.
Surveillance room means a secure location(s) in a gaming operation used primarily for casino surveillance.
Surveillance system means a system of video cameras, monitors, recorders, video printers, switches, selectors, and other ancillary equipment used for casino surveillance
(20) frames per second. Multiplexer tape recordings are insufficient to satisfy the requirement of sufficient clarity.
Surveillance room means a secure location(s) in a gaming operation used primarily for casino surveillance.
Surveillance system means a system of video cameras, monitors, recorders, video printers, switches, selectors, and other ancillary equipment used for casino surveillance.
Table games means games that are banked by the house or a pool whereby the house or the pool pays all winning bets and collects from all losing bets.
Table inventory means the total coins, chips, and markers at a table.
Table inventory form means the form used by gaming operation supervisory personnel to document the inventory of chips, coins, and tokens on a table at the beginning and ending of a shift.
Table tray means container located on gaming tables where chips, coins, or cash are stored that are used in the game.
Take means the same as earned and unearned take.
Theoretical hold means the intended hold percentage or win of an individual gaming machine as computed by reference to its payout schedule and reel strip settings or EPROM.
Theoretical hold worksheet means a worksheet provided by the manufacturer for all gaming machines which indicate the theoretical percentages that the gaming machine should hold based on adequate levels of coin-in. The worksheet also indicates the reel strip settings, number of credits that may be played, the payout schedule, the number of reels and other information descriptive of the particular type of gaming machine.
Tier A means gaming operations with annual gross gaming revenues of more than $1 million but not more than $5 million.
Tier B means gaming operations with annual gross gaming revenues of more than $5 million but not more than $15 million.
Tier C means gaming operations with annual gross gaming revenues of more than $15 million.
Tokens means a coin-like cash substitute, in various denominations, used for gambling transactions
h annual gross gaming revenues of more than $1 million but not more than $5 million.
Tier B means gaming operations with annual gross gaming revenues of more than $5 million but not more than $15 million.
Tier C means gaming operations with annual gross gaming revenues of more than $15 million.
Tokens means a coin-like cash substitute, in various denominations, used for gambling transactions.
Vault means a secure area within the gaming operation where tokens, checks, cash, coins, and chips are stored.
Weigh/count means the value of coins and tokens counted by a weigh machine.
Weigh scale interface means a communication device between the weigh scale used to calculate the amount of funds included in drop buckets and the computer system used to record the weigh data.
Weigh tape means the tape where weighed coin is recorded.
Wide area progressive gaming machine means progressive gaming machines that are linked to machines in other operations and all the machines affect the progressive amount. As wagers are placed, the progressive meter on all of the linked machines increase.
Win means the net win resulting from all gaming activities. Net win results from deducting all gaming losses from all wins prior to considering associated operating expenses.
Win-to-write hold percentage means win divided by write to determine hold percentage.
Wrap means the method of storing coins after the count process has been completed, including, but not limited to, wrapping, racking, or bagging. May also refer to the total amount or value of the counted and stored coins.
Write means the total amount wagered in keno, bingo, pull tabs, and pari-mutuel operations.
Writer means an employee who writes keno, bingo, pull tabs, or pari-mutuel tickets. A keno writer usually also makes payouts.

§ 542.3 How do I comply with this part? (a) Compliance based upon tier.
(1) Tier A gaming operations must comply with §§ 542.1 through 542.18.
(2) Tier B gaming operations must comply with §§ 542.1 through 542.18.
no, bingo, pull tabs, and pari-mutuel operations.
Writer means an employee who writes keno, bingo, pull tabs, or pari-mutuel tickets. A keno writer usually also makes payouts.

§ 542.3 How do I comply with this part? (a) Compliance based upon tier.
(1) Tier A gaming operations must comply with §§ 542.1 through 542.18.
(2) Tier B gaming operations must comply with §§ 542.1 through 542.18.
(3) Tier C gaming operations must comply with §§ 542.1 through 542.18.
(b) Determination of tier. The determination of tier level shall be made based upon the annual gross gaming revenues indicated within the gaming operation's audited financial statements. Gaming operations moving from one tier to another shall have nine (9) months from the date of the independent certified public accountant's audit report to achieve compliance with the requirements of the new tier.
(1) The Tribe or Tribal gaming regulatory authority may extend the deadline by an additional six (6) months if:
(i) The Tribe or Tribal gaming regulatory authority submits a written request to the Commission to extend the deadline no later than two weeks before the expiration of the initial nine (9) month period;
(ii) The request includes an explanation of why the gaming operation cannot come into compliance with a specific section(s) of the MICS within the initial nine (9) month period; and
(iii) The Tribe or Tribal gaming regulatory authority has not received written notification from the Commission denying the request within two weeks following submission of the request.
(2) [Reserved]
th period;
(ii) The request includes an explanation of why the gaming operation cannot come into compliance with a specific section(s) of the MICS within the initial nine (9) month period; and
(iii) The Tribe or Tribal gaming regulatory authority has not received written notification from the Commission denying the request within two weeks following submission of the request.
(2) [Reserved]
(c) Tribal internal control standards. Within six (6) months of [DATE OF PUBLICATION OF THE FINAL RULE IN THE Federal Register ], each Tribe or Tribal gaming regulatory authority shall establish by regulation and implement tribal internal control standards that shall:
(1) Be at least as stringent as those set forth in this part;
(2) Contain standards for currency transaction reporting that comply with 31 CFR part 103;
(3) Establish standards for games that are not addressed in this part; and
(4) Establish a deadline, which shall not exceed six (6) months from [DATE OF PUBLICATION OF THE FINAL RULE IN THE Federal Register ], by which a gaming operation must come into compliance with the tribal minimum internal control standards. However, the Tribe or Tribal gaming regulatory authority may extend the deadline by an additional six (6) months if:
(i) The Tribe or Tribal gaming regulatory authority submits a written request to the Commission to extend the deadline no later than two weeks before the expiration of the initial six (6) month period;
(ii) The request includes an explanation of why the gaming operation cannot come into compliance with a specific section(s) of the MICS within the initial six (6) month period; and
(iii) The Tribe or Tribal gaming regulatory authority has not received written notification from the Commission denying the request within two weeks following submission of the request.
nitial six (6) month period;
(ii) The request includes an explanation of why the gaming operation cannot come into compliance with a specific section(s) of the MICS within the initial six (6) month period; and
(iii) The Tribe or Tribal gaming regulatory authority has not received written notification from the Commission denying the request within two weeks following submission of the request.
(5) Existing gaming operations. All gaming operations that are operating on or before [DATE OF PUBLICATION OF THE FINAL RULE IN THE Federal Register ], shall comply with this part within the time requirements established in this paragraph. In the interim, such operations shall continue to comply with existing tribal internal control standards.
(6) New gaming operations. All gaming operations that commence operations after [DATE 60 DAYS AFTER DATE OF PUBLICATION OF THE FINAL RULE IN THE Federal Register ], shall comply with this part before commencement of operations.
(d) Submission to Commission. Tribal regulations promulgated pursuant to this part shall not be required to be submitted to the Commission pursuant to 25 CFR 522.3(b).
(e) Gaming operations. Each gaming operation shall develop and implement an internal control system that, at a minimum, complies with the tribal minimum internal control standards.
(f) CPA testing. (1) An independent certified public accountant (CPA) shall be engaged to perform procedures to verify, on a test basis, that the gaming operation is in material compliance with the tribal minimum internal
aming operations. Each gaming operation shall develop and implement an internal control system that, at a minimum, complies with the tribal minimum internal control standards.
(f) CPA testing. (1) An independent certified public accountant (CPA) shall be engaged to perform procedures to verify, on a test basis, that the gaming operation is in material compliance with the tribal minimum internal
(2) CPA Guidelines. In connection with the CPA testing pursuant to paragraph (f)(1) of this section, the Commission shall develop recommended CPA Guidelines available upon request.

§ 542.4 How do these regulations affect minimum internal control standards established in a Tribal-State compact? (a) If there is a direct conflict between an internal control standard established in a Tribal-State compact and a standard or requirement set forth in this part, then the internal control standard established in a Tribal-State compact shall prevail.
(b) If a standard in a Tribal-State compact is as or more stringent than a standard set forth in this part, then the Tribal-State compact standard shall prevail.
(c) If an internal control standard or a requirement set forth in this part is more stringent than an internal control standard established in a Tribal-State compact, then the internal control standard or requirement set forth in this part shall prevail.

§ 542.5 How do these regulations affect state jurisdiction? (a) Nothing in this part shall be construed to grant to a state jurisdiction in class II gaming or extend a state's jurisdiction in class III gaming.

§ 542.6 Does this part apply to small and charitable gaming operations? (a) Small gaming operations. This part shall not apply to small gaming operations provided that:
(1) The Tribal gaming regulatory authority permits the operation to be exempt from this part;
(2) The annual gross gaming revenue of the operation does not exceed $1 million; and
a state's jurisdiction in class III gaming.

§ 542.6 Does this part apply to small and charitable gaming operations? (a) Small gaming operations. This part shall not apply to small gaming operations provided that:
(1) The Tribal gaming regulatory authority permits the operation to be exempt from this part;
(2) The annual gross gaming revenue of the operation does not exceed $1 million; and
(3) The Tribal gaming regulatory authority develops and the operation complies with alternate procedures that:
(i) Protect the integrity of games offered; and
(ii) Safeguard the assets used in connection with the operation.
(b) Charitable gaming operations. This part shall not apply to charitable gaming operations provided that:
(1) All proceeds are for the benefit of a charitable organization;
(2) The Tribal gaming regulatory authority permits the charitable organization to be exempt from this part;
(3) The charitable gaming operation is operated wholly by the charitable organization's employees or volunteers;
(4) The annual gross gaming revenue of the charitable gaming operation does not exceed $100,000;
(i) Where the annual gross gaming revenues of the charitable gaming operation exceed $100,000, but are less than $1 million, paragraph (a) of this section shall also apply; and
(ii) [Reserved]
(5) The Tribal gaming regulatory authority develops and the charitable gaming operation complies with alternate procedures that:
(i) Protect the integrity of the games offered; and
(ii) Safeguard the assets used in connection with the gaming operation.
itable gaming operation exceed $100,000, but are less than $1 million, paragraph (a) of this section shall also apply; and
(ii) [Reserved]
(5) The Tribal gaming regulatory authority develops and the charitable gaming operation complies with alternate procedures that:
(i) Protect the integrity of the games offered; and
(ii) Safeguard the assets used in connection with the gaming operation.
(c) Independent operators. Nothing in this section shall exempt gaming operations conducted by independent operators for the benefit of a charitable organization.

Subpart B—Gaming Operations
§ 542.7 What are the minimum internal control standards for bingo? (a) Computer applications. For any computer applications utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this section, as approved by the Tribal gaming regulatory authority, will be acceptable.
(b) Game play standards. The functions of seller and payout verifier shall be segregated. Employees who sell cards on the floor shall not verify payouts with cards in their possession. Floor clerks who sell cards on the floor are permitted to announce the serial numbers of winning cards.
(2) All sales of bingo cards shall be documented by recording at least the following:
(i) Date;
(ii) Shift (if applicable);
(iii) Session (if applicable);
(iv) Dollar amount;
(v) Signature, initials, or identification number of at least one seller (if manually documented); and
(vi) Signature, initials, or identification number of person independent of seller who has randomly verified the card sales (this requirement is not applicable to locations with $1 million or less in annual write).
(3) The total win and write shall be computed and recorded by shift (or session, if applicable).
ials, or identification number of at least one seller (if manually documented); and
(vi) Signature, initials, or identification number of person independent of seller who has randomly verified the card sales (this requirement is not applicable to locations with $1 million or less in annual write).
(3) The total win and write shall be computed and recorded by shift (or session, if applicable).
(4) The Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall develop and the gaming operation shall comply with procedures that ensure the correct calling of numbers selected in the bingo game.
(5) Each ball shall be shown to a camera immediately before it is called so that it is individually displayed to all patrons. For speed bingo games not verified by camera equipment, each ball drawn shall be verified by an independent person.
(6) For all coverall games and other games offering a payout of $1,200 or more, as the balls are called the numbers shall be immediately recorded by the caller and maintained for a minimum of 24 hours.
(7) Controls shall be present to assure that the numbered balls are placed back into the selection device prior to calling the next game.
(8) The authenticity of each payout shall be verified by at least two persons. A computerized card verifying system may function as the second person verifying the payout if the card with the winning numbers is displayed on a reader board.
(9) Payouts in excess of $1,200 shall require written approval, by personnel independent of the transaction, that the bingo card has been examined and verified with the bingo card record to ensure that the ticket has not been altered.
(10) Total payout shall be computed and recorded by shift or session, if applicable.
(c) Promotional payouts or awards. (1) If the gaming operation offers promotional payouts or awards, the payout form/documentation shall include the following information:
transaction, that the bingo card has been examined and verified with the bingo card record to ensure that the ticket has not been altered.
(10) Total payout shall be computed and recorded by shift or session, if applicable.
(c) Promotional payouts or awards. (1) If the gaming operation offers promotional payouts or awards, the payout form/documentation shall include the following information:
(i) Date and time;
(ii) Dollar amount of payout or description of personal property (e.g., jacket, toaster, car, etc.), including fair market value;
(iii) Type of promotion; and
(iv) Signature of at least one employee authorizing and completing the transaction.
(2) [Reserved]
(d) Accountability form. (1) All funds used to operate the bingo department shall be recorded on an accountability form.
(2) All funds used to operate the bingo department shall be counted independently by at least two persons and reconciled to the recorded amounts at the end of each shift or session.
(e) Bingo equipment. (1) Access to controlled bingo equipment (e.g., blower, balls in play, and back-up balls) shall be restricted to authorized persons.
(2) Procedures shall be established to inspect new bingo balls put into play as well as for those in use.
(3) Bingo equipment shall be maintained and checked for accuracy on a periodic basis.
(4) The bingo card inventory shall be controlled so as to assure the integrity of the cards being used as follows:
, blower, balls in play, and back-up balls) shall be restricted to authorized persons.
(2) Procedures shall be established to inspect new bingo balls put into play as well as for those in use.
(3) Bingo equipment shall be maintained and checked for accuracy on a periodic basis.
(4) The bingo card inventory shall be controlled so as to assure the integrity of the cards being used as follows:
(i) Purchased paper shall be inventoried and secured by an individual independent from the bingo sales;
(ii) The issue of paper to the cashiers shall be documented and signed for by the inventory control department and cashier. The document log shall include the series number of the bingo paper;
(iii) A copy of the bingo paper control log shall be given to the bingo ball caller for purposes of determining if the winner purchased the paper that was issued to the gaming operation that day (electronic verification satisfies this standard);
(iv) At the end of each month, an independent person shall verify the accuracy of the ending balance in the bingo paper control by counting the paper on-hand;
(v) Monthly the amount of paper sold from the bingo paper control log shall be compared to the amount of revenue for reasonableness.
(f) Standards for statistical reports. (1) Records shall be maintained, which include win, write (card sales), and a win-to-write hold percentage, for:
(i) Each shift or each session;
(ii) Each day;
(iii) Month-to-date; and
(iv) Year-to-date or fiscal year-to-date.
(2) Non-bingo management shall review bingo statistical information at least on a monthly basis and investigate any large or unusual statistical fluctuations.
(3) Investigations shall be documented and maintained for Commission inspection.
(g) Electronic equipment. (1) If the gaming operation utilizes electronic equipment in connection with the play of bingo, then the following standards shall also apply.
management shall review bingo statistical information at least on a monthly basis and investigate any large or unusual statistical fluctuations.
(3) Investigations shall be documented and maintained for Commission inspection.
(g) Electronic equipment. (1) If the gaming operation utilizes electronic equipment in connection with the play of bingo, then the following standards shall also apply.
(i) If the electronic equipment contains a bill acceptor, then § 542.21(d) and (e), § 542.31(d) and (e), or § 542.41(d) and (e)(as applicable) shall apply.
(ii) If the electronic equipment uses a bar code or microchip reader, the reader shall be tested periodically by an entity independent of bingo personnel to determine that it is correctly reading the bar code or the microchip.
(iii) If the electronic equipment returns a voucher or a payment slip to the player, then § 542.13(n) (as applicable) shall apply.
(2) [Reserved]
(h) Standards for linked electronic games. Management shall ensure that all agreements/contracts entered into after [the effective date of the final rule] to provide linked electronic games shall contain a provision requiring the vendor to comply with the standards in this section.
(i) Host requirements/game information (for linked electronic games). (1) Providers of any linked electronic game(s) shall maintain complete records of game data for a period of one (1) year from the date the games are played (or a time frame established by the Tribal gaming regulatory authority). This data may be kept in an archived manner, provided the information can be produced within 24 hours upon request. In any event, game data for the preceding 72 hours shall be immediately accessible.
(2) Data required to be maintained for each game played includes:
(i) Date and time game start and game end;
(ii) Sales information by location;
(iii) Cash distribution by location;
(iv) Refund totals by location;
an archived manner, provided the information can be produced within 24 hours upon request. In any event, game data for the preceding 72 hours shall be immediately accessible.
(2) Data required to be maintained for each game played includes:
(i) Date and time game start and game end;
(ii) Sales information by location;
(iii) Cash distribution by location;
(iv) Refund totals by location;
(v) Cards-in-play count by location;
(vi) Identification number of winning card(s);
(vii) Ordered list of bingo balls drawn; and
(viii) Prize amounts at start and end of game.
(j) Host requirements/sales information (for linked electronic games). (1) Providers of any linked electronic game(s) shall maintain complete records of sales data for a period of one (1) year from the date the games are played (or a time frame established by the Tribal gaming regulatory authority). This data may be kept in an archived manner, provided the information can be produced within 24 hours upon request. In any event, sales data for the preceding 10 days shall be immediately accessible. Summary information must be accessible for at least 120 days.
(2) Sales information required shall include:
(i) Daily sales totals by location;
(ii) Commissions distribution summary by location;
(iii) Game-by-game sales, prizes, refunds, by location; and
(iv) Daily network summary, by game by location.
(k) Remote host requirements (for linked electronic games). (1) Linked electronic game providers shall maintain online records at the remote host site for any game played. These records shall remain online until the conclusion of the session of which the game is a part. Following the conclusion of the session, records may be archived, but in any event, must be retrievable in a timely manner for at least 72 hours following the close of the session. Records shall be accessible through some archived media for at least 90 days from the date of the game.
ny game played. These records shall remain online until the conclusion of the session of which the game is a part. Following the conclusion of the session, records may be archived, but in any event, must be retrievable in a timely manner for at least 72 hours following the close of the session. Records shall be accessible through some archived media for at least 90 days from the date of the game.
(2) Game information required includes date and time of game start and game end, sales totals, cash distribution (prizes) totals, and refund totals.
(3) Sales information required includes cash register reconciliations, detail and summary records for purchases, prizes, refunds, credits, and game/sales balance for each session.
(l) Standards for player accounts (for proxy play and linked electronic games). (1) Prior to participating in any game, players shall be issued a unique player account number. The player account number can be issued through the following means:
(i) Through the use of a point-of-sale (cash register device);
(ii) By assignment through an individual play station; or
(iii) Through the incorporation of a “player tracking” media.
(2) Printed receipts issued in conjunction with any player account should include a time/date stamp.
(3) All player transactions shall be maintained, chronologically by account number, through electronic means on a data storage device. These transaction records shall be maintained online throughout the active game and for at least 24 hours before they can be stored on an “off-line” data storage media.
(4) The game software shall provide the ability to, upon request, produce a printed account history, including all transactions, and a printed game summary (total purchases, deposits, wins, debits, for any account that has been active in the game during the preceding 24 hours).
ne throughout the active game and for at least 24 hours before they can be stored on an “off-line” data storage media.
(4) The game software shall provide the ability to, upon request, produce a printed account history, including all transactions, and a printed game summary (total purchases, deposits, wins, debits, for any account that has been active in the game during the preceding 24 hours).
(5) The game software shall provide a “player account summary” at the end of every game. This summary shall list all accounts for which there were any transactions during that game day and include total purchases, total deposits, total credits (wins), total debits (cash-outs) and an ending balance.

§ 542.8 What are the minimum internal control standards for pull tabs? (a) Computer applications. For any computer application utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this
(b) Pull tab inventory. (1) Pull tab inventory (including unused tickets) shall be controlled, to assure the integrity of the pull tabs.
(2) Purchased pull tabs shall be inventoried and secured by an individual independent from the pull tab sales.
(3) The issue of pull tabs to the cashier or sales location shall be documented and signed for by the inventory control department and the cashier witnessing the fill. The document log shall include the serial number of the pull tabs.
(4) Appropriate documentation shall be given to the redemption booth for purposes of determining if the winner purchased the pull tab that was issued by the gaming operation. Electronic verification satisfies this requirement.
(5) At the end of each month, an independent person shall verify the accuracy of the ending balance in the pull tab control by counting the pull tabs on hand.
(6) A monthly comparison for reasonableness shall be made of the amount of pull tabs sold from the pull tab control log to the amount of revenue recognized.
ed by the gaming operation. Electronic verification satisfies this requirement.
(5) At the end of each month, an independent person shall verify the accuracy of the ending balance in the pull tab control by counting the pull tabs on hand.
(6) A monthly comparison for reasonableness shall be made of the amount of pull tabs sold from the pull tab control log to the amount of revenue recognized.
(c) Access. Access to pull tabs shall be restricted to authorized persons.
(d) Transfers. Transfers of pull tabs from storage to the sale location shall be secured and independently controlled.
(e) Winning pull tabs. (1) Winning pull tabs shall be verified and paid as follows:
(i) Payouts in excess of a dollar amount determined by the Tribal gaming regulatory authority shall be verified by at least two employees.
(ii) Total payout shall be computed and recorded by shift.
(iii) The winning pull tabs shall be voided so that they cannot be presented for payment again.
(2) Personnel independent of pull tab management shall verify the amount of winning pull tabs redeemed each day.
(f) Accountability form. (1) All funds used to operate the pull tab game shall be recorded on an accountability form.
(2) All funds used to operate the pull tab game shall be counted independently by at least two persons and reconciled to the recorded amounts at the end of each shift or session.
(g) Standards for statistical reports. (1) Records shall be maintained, which include win, write (sales), and a win-to-write hold percentage as compared to the theoretical hold percentage derived from the flare, for:
(i) Each deal or type of game;
(ii) Each shift;
(iii) Each day;
(iv) Month-to-date; and
persons and reconciled to the recorded amounts at the end of each shift or session.
(g) Standards for statistical reports. (1) Records shall be maintained, which include win, write (sales), and a win-to-write hold percentage as compared to the theoretical hold percentage derived from the flare, for:
(i) Each deal or type of game;
(ii) Each shift;
(iii) Each day;
(iv) Month-to-date; and
(v) Year-to-date or fiscal year-to-date as applicable.
(2) Non-pull tab management independent of pull tab personnel shall review statistical information at least on a monthly basis and shall investigate any large or unusual statistical fluctuations. These investigations shall be documented and maintained for inspection.
(3) Each month, the actual hold percentage shall be compared to the theoretical hold percentage. Any significant variations (±3%) shall be investigated.
(h) Electronic equipment. (1) If the gaming operation utilizes electronic equipment in connection with the play of pull tabs, then the following standards shall also apply.
(i) If the electronic equipment contains a bill acceptor, then § 542.21(d) and (e), § 542.31(d) and (e), or § 542.41(d) and (e)(as applicable) shall apply.
(ii) If the electronic equipment uses a bar code or microchip reader, the reader shall be tested periodically to determine that it is correctly reading the bar code or microchip.
(iii) If the electronic equipment returns a voucher or a payment slip to the player, then § 542.13(n)(as applicable) shall apply.
(2) [Reserved]

§ 542.9 What are the minimum internal control standards for card games? (a) Computer applications. For any computer applications utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this section, as approved by the Tribal gaming regulatory authority, will be acceptable.
2.13(n)(as applicable) shall apply.
(2) [Reserved]

§ 542.9 What are the minimum internal control standards for card games? (a) Computer applications. For any computer applications utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this section, as approved by the Tribal gaming regulatory authority, will be acceptable.
(b) Standards for drop and count. The procedures for the collection of card games drop boxes and the count of the contents thereof shall comply with this part as it is applicable to table game drop and table game soft count.
(c) Standards for supervision. (1) Supervision shall be provided at all times the card room is in operation by personnel with authority equal to or greater than those being supervised.
(2) Exchanges between table banks and the main card room bank (or cage, if a main card room bank is not used) in excess of $100.00 shall be authorized by a supervisor. All exchanges shall be evidenced by the use of a lammer unless the exchange of chips, tokens, and/or cash takes place at the table.
(3) Exchanges from the main card room bank (or cage, if a main card room bank is not used) to the table banks shall be verified by the card room dealer and the runner.
(4) If applicable, transfers between the main card room bank and the cage shall be properly authorized and documented.
(5) A rake collected or ante placed shall be done in accordance with the posted rules.
place at the table.
(3) Exchanges from the main card room bank (or cage, if a main card room bank is not used) to the table banks shall be verified by the card room dealer and the runner.
(4) If applicable, transfers between the main card room bank and the cage shall be properly authorized and documented.
(5) A rake collected or ante placed shall be done in accordance with the posted rules.
(d) Standards for playing cards. (1) Playing cards shall be maintained in a secure location to prevent unauthorized access and to reduce the possibility of tampering.
(2) Used cards shall be maintained in a secure location until marked, scored, or destroyed, in a manner subject to the approval of the Tribal gaming regulatory authority, to prevent unauthorized access and reduce the possibility of tampering.
(3) The Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall establish a reasonable time period, which shall not exceed seven (7) days of use, within which to mark and remove cards from play.
(i) This standard shall not apply where playing cards are retained for an investigation.
(ii) [Reserved]
(4) A card control log shall be maintained that documents when cards are received on site, distributed to and returned from tables and removed from the gaming operation.
(e) Plastic cards. Notwithstanding paragraph (d) of this section, if a gaming operation uses plastic cards (not plastic-coated cards), the cards may be used for up to three (3) months if the plastic cards are washed or cleaned after at least every 72 hours of use.
(f) Standards for shills. (1) Issuance of shill funds shall have the written approval of the supervisor.
(2) Shill returns shall be recorded and verified on the shill sign-out form.
(3) The replenishment of shill funds shall be documented.
plastic-coated cards), the cards may be used for up to three (3) months if the plastic cards are washed or cleaned after at least every 72 hours of use.
(f) Standards for shills. (1) Issuance of shill funds shall have the written approval of the supervisor.
(2) Shill returns shall be recorded and verified on the shill sign-out form.
(3) The replenishment of shill funds shall be documented.
(g) Standards for reconciliation of card room bank. (1) The amount of the main card room bank shall be counted, recorded, and reconciled on at least a per shift basis.
(2) At least once per shift, the table banks that were opened during that shift shall be counted, recorded, and reconciled by a dealer (or other individual if the table is closed) and a supervisor, and shall be attested to by their signatures on the check-out form.
(h) Standards for promotional progressive pots and pools. (1) All funds contributed by players into the pools shall be returned when won in
(2) Rules governing promotional pools shall be conspicuously posted and designate:
(i) The amount of funds to be contributed from each pot;
(ii) What type of hand it takes to win the pool (e.g., what constitutes a “bad beat”);
(iii) How the promotional funds will be paid out;
(iv) How/when the contributed funds are added to the jackpots; and
(v) Amount/percentage of funds allocated to primary and secondary jackpots, if applicable.
(3) Promotional pool contributions shall not be placed in or near the rake circle, in the drop box, or commingled with gaming revenue from card games or any other gambling game.
(4) The amount of the jackpot shall be conspicuously displayed in the card room.
(5) At least once a day, the posted pool amount shall be updated to reflect the current pool amount.
(6) At least once a day, increases to the posted pool amount shall be reconciled to the cash previously counted or received by the cage by personnel independent of the card room.
ames or any other gambling game.
(4) The amount of the jackpot shall be conspicuously displayed in the card room.
(5) At least once a day, the posted pool amount shall be updated to reflect the current pool amount.
(6) At least once a day, increases to the posted pool amount shall be reconciled to the cash previously counted or received by the cage by personnel independent of the card room.
(7) All decreases to the pool must be properly documented, including a reason for the decrease.
(i) Promotional progressive pots and pools where funds are displayed in the card room. Promotional funds displayed in the card room shall be placed in a locked container in plain view of the public.
(2) Persons authorized to transport the locked container shall be precluded from having access to the contents keys.
(3) The contents key shall be maintained by personnel independent of the card room.
(4) At least once a day, the locked container shall be removed by two individuals, one of whom is independent of the card games department, and transported directly to the cage or other secure room to be counted, recorded, and verified.
(5) The locked container shall then be returned to the card room where the posted pool amount shall be updated to reflect the current pool amount.
(j) Promotional progressive pots and pools where funds are maintained in the cage. (1) Promotional funds removed from the card game shall be placed in a locked container.
(2) Persons authorized to transport the locked container shall be precluded from having access to the contents keys.
(3) The contents key shall be maintained by personnel independent of the card room.
(4) At least once a day, the locked container shall be removed by two individuals, one of whom is independent of the card games department, and transported directly to the cage or other secure room to be counted, recorded, and verified, prior to accepting the funds into cage accountability.
the contents keys.
(3) The contents key shall be maintained by personnel independent of the card room.
(4) At least once a day, the locked container shall be removed by two individuals, one of whom is independent of the card games department, and transported directly to the cage or other secure room to be counted, recorded, and verified, prior to accepting the funds into cage accountability.
(5) The posted pool amount shall then be updated to reflect the current pool amount.

§ 542.10 What are the minimum internal control standards for keno? (a) Computer applications. For any computer applications utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this section, as approved by the Tribal gaming regulatory authority, will be acceptable.
(b) Game play standards. (1) The computerized customer ticket shall include the date, game number, ticket sequence number, station number, and conditioning (including multi-race if applicable).
(2) Concurrently with the generation of the ticket the information on the ticket shall be recorded on a restricted transaction log or computer storage media.
(3) Keno personnel shall be precluded from access to the restricted transaction log or computer storage media.
(4) When it is necessary to void a ticket, the void information shall be inputted in the computer and the computer shall document the appropriate information pertaining to the voided wager (e.g., void slip is issued or equivalent documentation is generated).
(5) Controls shall exist to prevent the writing and voiding of tickets after a game has been closed and after the number selection process for that game has begun.
(6) The controls in effect for tickets prepared in outstations (if applicable) shall be identical to those in effect for the primary keno game.
(c) Rabbit ear or wheel system. (1) The following standards shall apply if a rabbit ear or wheel system is utilized:
revent the writing and voiding of tickets after a game has been closed and after the number selection process for that game has begun.
(6) The controls in effect for tickets prepared in outstations (if applicable) shall be identical to those in effect for the primary keno game.
(c) Rabbit ear or wheel system. (1) The following standards shall apply if a rabbit ear or wheel system is utilized:
(i) A dedicated camera shall be utilized to monitor the following both prior to, and subsequent to, the calling of a game:
(A) Empty rabbit ears or wheel;
(B) Date and time;
(C) Game number; and
(D) Full rabbit ears or wheel.
(ii) The film of the rabbit ears or wheel shall provide a legible identification of the numbers on the balls drawn.
(iii) Keno personnel shall immediately input the selected numbers in the computer and the computer shall document the date, the game number, the time the game was closed, and the numbers drawn.
(iv) The Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall establish and the gaming operation shall comply with procedures that prevent unauthorized access to keno balls in play.
(v) Back-up keno ball inventories shall be secured in a manner to prevent unauthorized access.
(vi) The Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall establish and the gaming operation shall comply with procedures for inspecting new keno balls put into play as well as for those in use.
(2) [Reserved]
(d) Random number generator. (1) The following standards shall apply if a random number generator is utilized:
(i) The random number generator shall be linked to the computer system and shall directly relay the numbers selected into the computer without manual input.
(ii) Keno personnel shall be precluded from access to the random number generator.
(2) [Reserved]
in use.
(2) [Reserved]
(d) Random number generator. (1) The following standards shall apply if a random number generator is utilized:
(i) The random number generator shall be linked to the computer system and shall directly relay the numbers selected into the computer without manual input.
(ii) Keno personnel shall be precluded from access to the random number generator.
(2) [Reserved]
(e) Winning tickets. Winning tickets shall be verified and paid as follows:
(1) The sequence number of tickets presented for payment shall be inputted into the computer, and the payment amount generated by the computer shall be given to the patron.
(2) The Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall establish and the gaming operation shall comply with procedures to preclude payment on tickets previously presented for payment, unclaimed winning tickets (sleepers) after a specified period of time, voided tickets, and tickets which have not been issued yet.
(3) All payouts shall be supported by the customer (computer-generated) copy of the winning ticket (payout amount is indicated on the customer ticket or a payment slip is issued).
(4) A manual report or other documentation shall be produced and maintained documenting any payments made on tickets which are not authorized by the computer.
(5) Winning tickets over a specified dollar amount (not to exceed $10,000 for locations with more than $5 million annual keno write and $3,000 for all other locations) shall also require the following:
cket or a payment slip is issued).
(4) A manual report or other documentation shall be produced and maintained documenting any payments made on tickets which are not authorized by the computer.
(5) Winning tickets over a specified dollar amount (not to exceed $10,000 for locations with more than $5 million annual keno write and $3,000 for all other locations) shall also require the following:
(i) Approval of management personnel independent of the keno department, evidenced by their signature;
(ii) Review of the video recording and/or digital record of the rabbit ears or wheel to verify the legitimacy of the draw and the accuracy of the draw ticket (for rabbit ear or wheel systems only);
(iii) Comparison of the winning customer copy to the computer reports;
(iv) Regrading of the customer copy using the payout schedule and draw information; and
(v) Documentation and maintenance of the procedures in this paragraph.
(6) When the keno game is operated by one person, all winning tickets in excess of an amount to be determined by management (not to exceed $1,500) shall be reviewed and authorized by someone independent of the keno department.
(f) Check out standards at the end of each keno shift. (1) For each writer station, a cash summary report (count sheet) shall be prepared that includes:
(i) Computation of net cash proceeds for the shift and the cash turned in; and
(ii) Signatures of two employees who have verified the net cash proceeds for the shift and the cash turned in.
(2) [Reserved]
(g) Promotional payouts or awards. (1) If a gaming operation offers promotional payouts or awards, the payout form/documentation shall include the following information:
(i) Date and time;
(ii) Dollar amount of payout or description of personal property (e.g., jacket, toaster, car, etc.), including fair market value;
(iii) Type of promotion; and
(iv) Signature of at least one employee authorizing and completing the transaction.
(2) [Reserved]
ion offers promotional payouts or awards, the payout form/documentation shall include the following information:
(i) Date and time;
(ii) Dollar amount of payout or description of personal property (e.g., jacket, toaster, car, etc.), including fair market value;
(iii) Type of promotion; and
(iv) Signature of at least one employee authorizing and completing the transaction.
(2) [Reserved]
(h) Standards for statistical reports. (1) Records shall be maintained which include win and write by individual writer for each day.
(2) Records shall be maintained which include win, write, and win-to-write hold percentage for:
(i) Each shift;
(ii) Each day;
(iii) Month-to-date; and
(iv) Year-to-date or fiscal year-to-date as applicable.
(3) Non-keno management independent from the keno personnel shall review keno statistical data at least on a monthly basis and investigate any large or unusual statistical variances.
(4) At a minimum, investigations shall be performed for statistical percentage fluctuations from the base level for a month in excess of +/-3%. The base level shall be defined as the gaming operation's win percentage for the previous business year or the previous 12 months.
(5) Such investigations shall be documented and maintained.
(i) System security standards. (1) All keys (including duplicates) to sensitive computer hardware in the keno area shall be maintained by a department independent of the keno function.
(2) Personnel independent of the keno department shall be required to accompany such keys to the keno area and shall observe changes or repairs each time the sensitive areas are accessed.
(j) Documentation standards. (1) Adequate documentation of all pertinent keno information shall be generated by the computer system.
(2) This documentation shall be restricted to authorized personnel.
(3) The documentation shall include, at a minimum:
nt shall be required to accompany such keys to the keno area and shall observe changes or repairs each time the sensitive areas are accessed.
(j) Documentation standards. (1) Adequate documentation of all pertinent keno information shall be generated by the computer system.
(2) This documentation shall be restricted to authorized personnel.
(3) The documentation shall include, at a minimum:
(i) Ticket information (as described in paragraph (b)(1) of this section);
(ii) Payout information (date, time, ticket number, amount, etc.);
(iii) Game information (number, ball draw, time, etc.);
(iv) Daily recap information, including:
(A) Write;
(B) Payouts; and
(C) Gross revenue (win);
(v) System exception information, including:
(A) Voids;
(B) Late pays; and
(C) Appropriate system parameter information (e.g., changes in pay tables, ball draws, payouts over a predetermined amount, etc.); and
(vi) Personnel access listing, including:
(A) Employee name;
(B) Employee identification number; and
(C) Listing of functions employee can perform or equivalent means of identifying same.
(k) Keno audit standards. (1) The keno audit function shall be independent of the keno department.
(2) At least annually, keno audit shall foot the write on the restricted copy of the keno transaction report for a minimum of one shift and compare the total to the total as documented by the computer.
(3) For at least one shift every other month, keno audit shall perform the following:
(i) Foot the customer copy of the payouts and trace the total to the payout report; and
(ii) Regrade at least 1% of the winning tickets using the payout schedule and draw ticket.
(4) Keno audit shall perform the following:
mum of one shift and compare the total to the total as documented by the computer.
(3) For at least one shift every other month, keno audit shall perform the following:
(i) Foot the customer copy of the payouts and trace the total to the payout report; and
(ii) Regrade at least 1% of the winning tickets using the payout schedule and draw ticket.
(4) Keno audit shall perform the following:
(i) For a minimum of five games per week, compare the video recording and/or digital record of the rabbit ears or wheel to the computer transaction summary;
(ii) Compare net cash proceeds to the audited win/loss by shift and investigate any large cash overages or shortages (i.e., in excess of $25.00);
(iii) Review and regrade all winning tickets greater than or equal to $1,500, including all forms which document that proper authorizations and verifications were obtained and performed;
(iv) Review the documentation for payout adjustments made outside the computer and investigate large and frequent payments;
(v) Review personnel access listing for inappropriate functions an employee can perform;
(vi) Review system exception information on a daily basis for propriety of transactions and unusual occurrences including changes to the personnel access listing;
(vii) If a random number generator is used, then at least weekly review the numerical frequency distribution for potential patterns; and
(viii) Investigate and document results of all noted improper transactions or unusual occurrences.
(5) When the keno game is operated by one person:
is for propriety of transactions and unusual occurrences including changes to the personnel access listing;
(vii) If a random number generator is used, then at least weekly review the numerical frequency distribution for potential patterns; and
(viii) Investigate and document results of all noted improper transactions or unusual occurrences.
(5) When the keno game is operated by one person:
(i) The customer copies of all winning tickets in excess of $100 and at least 5% of all other winning tickets shall be regraded and traced to the computer payout report;
(ii) The video recording and/or digital record of rabbit ears or wheel shall be randomly compared to the computer game information report for at least 10% of the games during the shift; and
(iii) Keno audit personnel shall review winning tickets for proper authorization pursuant to paragraph (e)(6) of this section.
(6) In the event any person performs the writer and deskman functions on the same shift, the procedures described in paragraphs (k)(5)(i) and (ii) of this section (using the sample sizes indicated) shall be performed on tickets written by that person.
(7) Documentation (e.g., a log, checklist, etc.) which evidences the
(8) Non-keno management shall review keno audit exceptions, and perform and document investigations into unresolved exceptions.
(9) When a multi-game ticket is part of the sample in paragraphs (k)(3)(ii), (k)(5)(i) and (k)(6) of this section, the procedures may be performed for 10 games or 10% of the games won, whichever is greater.
(l) Access. Access to the computer system shall be adequately restricted (i.e., passwords are changed at least quarterly, access to computer hardware is physically restricted, etc.).
(m) Equipment standards.
(1) There shall be effective maintenance planned to service keno equipment, including computer program updates, hardware servicing, and keno ball selection equipment (e.g., service contract with lessor).
ss to the computer system shall be adequately restricted (i.e., passwords are changed at least quarterly, access to computer hardware is physically restricted, etc.).
(m) Equipment standards.
(1) There shall be effective maintenance planned to service keno equipment, including computer program updates, hardware servicing, and keno ball selection equipment (e.g., service contract with lessor).
(i) Keno equipment maintenance (excluding keno balls) shall be independent of the operation of the keno game.
(ii) Keno maintenance personnel shall report irregularities to management personnel independent of keno.
(iii) If the gaming operation utilizes a barcode or microchip reader in connection with the play of keno, the reader shall be tested at least annually by personnel independent of the keno department to determine that it is correctly reading the barcode or microchip.
(2) [Reserved]
(n) Document retention.
(1) All documents, including computer storage media, discussed in this section shall be retained for five (5) years, except for the following, which shall be retained for at least seven (7) days:
(i) Video recordings and/or digital records of rabbit ears or wheel;
(ii) All copies of winning keno tickets of less than $1,500.00.
(2) [Reserved]
(o) Multi-race tickets. (1) Procedures shall be established to notify keno personnel immediately of large multi-race winners to ensure compliance with standards in paragraph (e)(5) of this section.
(2) Procedures shall be established to ensure that keno personnel are aware of multi-race tickets still in process at the end of a shift.
nning keno tickets of less than $1,500.00.
(2) [Reserved]
(o) Multi-race tickets. (1) Procedures shall be established to notify keno personnel immediately of large multi-race winners to ensure compliance with standards in paragraph (e)(5) of this section.
(2) Procedures shall be established to ensure that keno personnel are aware of multi-race tickets still in process at the end of a shift.
(p) Manual keno. For gaming facilities that conduct manual keno games, alternate procedures that provide at least the level of control described by the standards in this section shall be developed and implemented.

§ 542.11 What are the minimum internal control standards for pari-mutuel wagering? (a) Exemptions. (1) The requirements of this section shall not apply to gaming operations who house pari-mutuel wagering operations conducted entirely by a state licensed simulcast service provider pursuant to an approved tribal-state compact if:
(i) The simulcast service provider utilizes its own employees for all aspects of the pari-mutuel wagering operation;
(ii) The gaming operation posts, in a location visible to the public, that the simulcast service provider and its employees are wholly responsible for the conduct of pari-mutuel wagering offered at that location;
(iii) The gaming operation receives a predetermined fee from the simulcast service provider; and
(iv) In addition, the Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall adopt standards that ensure that the gaming operation receives, from the racetrack, its contractually guaranteed percentage of the handle.
(2) Gaming operations that contract directly with a state regulated racetrack as a simulcast service provider, but whose on-site pari-mutuel operations are conducted wholly or in part by tribal gaming operation employees, shall not be required to comply with paragraphs (h)(5) thru (h)(9) of this section.
ration receives, from the racetrack, its contractually guaranteed percentage of the handle.
(2) Gaming operations that contract directly with a state regulated racetrack as a simulcast service provider, but whose on-site pari-mutuel operations are conducted wholly or in part by tribal gaming operation employees, shall not be required to comply with paragraphs (h)(5) thru (h)(9) of this section.
(i) If any standard contained within this section conflicts with state law, a tribal-state compact, or a contract, then the gaming operation shall document the basis for noncompliance and shall maintain such documentation for inspection by the Tribal gaming regulatory authority and the Commission.
(ii) In addition, the Tribal gaming regulatory authority, or the gaming operation subject to the approval of the Tribal gaming regulatory authority, shall adopt standards that ensure that the gaming operation receives, from the racetrack, its contractually guaranteed percentage of the handle.
(b) Computer applications. For any computer applications utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this section, as approved by the Tribal gaming regulatory authority, will be acceptable.
(c) Betting ticket and equipment standards. (1) All pari-mutuel wagers shall be transacted through the pari-mutuel satellite system. In case of computer failure between the pari-mutuel book and the hub, no tickets shall be manually written.
(2) Whenever a betting station is opened for wagering or turned over to a new writer/cashier, the writer/cashier shall sign on and the computer shall document gaming operation name, station number, the writer/cashier identifier, and the date and time.
(3) A betting ticket shall consist of at least two parts:
ilure between the pari-mutuel book and the hub, no tickets shall be manually written.
(2) Whenever a betting station is opened for wagering or turned over to a new writer/cashier, the writer/cashier shall sign on and the computer shall document gaming operation name, station number, the writer/cashier identifier, and the date and time.
(3) A betting ticket shall consist of at least two parts:
(i) An original, which shall be transacted and issued through a printer and given to the patron; and
(ii) A copy that shall be recorded concurrently with the generation of the original ticket either on paper or other storage media (e.g., tape or diskette).
(4) Upon accepting a wager, the betting ticket that is created shall contain the following:
(i) A unique transaction identifier;
(ii) Gaming operation name and station number;
(iii) Race track, race number, horse identification or event identification, as applicable;
(iv) Type of bet(s), each bet amount, total number of bets, and total take; and
(v) Date and time.
(5) All tickets shall be considered final at post time.
(6) If a gaming operation voids a betting ticket written prior to post time, it shall be immediately entered into the system.
(7) Future wagers shall be accepted and processed in the same manner as regular wagers.
(d) Payout standards. (1) Prior to making payment on a ticket the writer/cashier shall input the ticket for verification and payment authorization.
(2) The computer shall be incapable of authorizing payment on a ticket that has been previously paid, a voided ticket, a losing ticket, or an unissued ticket.
(e) Checkout standards. (1) Whenever the betting station is closed or the writer/cashier is replaced, the writer/cashier shall sign off and the computer shall document the gaming operation name, station number, the writer/cashier identifier, the date and time, and cash balance.
(2) For each writer/cashier station a summary report shall be completed at the conclusion of each shift including:
.
(e) Checkout standards. (1) Whenever the betting station is closed or the writer/cashier is replaced, the writer/cashier shall sign off and the computer shall document the gaming operation name, station number, the writer/cashier identifier, the date and time, and cash balance.
(2) For each writer/cashier station a summary report shall be completed at the conclusion of each shift including:
(i) Computation of cash turned in for the shift; and
(ii) Signatures of two employees who have verified the cash turned in for the shift.
(f) Employee wagering. Pari-mutuel employees shall be prohibited from wagering on race events while on duty, including during break periods.
(g) Computer reports standards. (1) Adequate documentation of all
(2) This documentation shall be restricted to authorized personnel.
(3) The documentation shall be created for each day's operation and shall include, but is not limited to:
(i) Unique transaction identifier;
(ii) Date/time of transaction;
(iii) Type of wager;
(iv) Animal identification or event identification;
(v) Amount of wagers (by ticket, writer/SAM, track/event, and total);
(vi) Amount of payouts (by ticket, writer/SAM, track/event, and total);
(vii) Tickets refunded (by ticket, writer, track/event, and total);
(viii) Unpaid winners/vouchers (“outs”) (by ticket/voucher, track/event, and total);
(ix) Voucher sales/payments (by ticket, writer/SAM, and track/event);
(x) Voids (by ticket, writer, and total);
(xi) Future wagers (by ticket, date of event, total by day, and total at the time of revenue recognition);
(xii) Results (winners and payout data);
(xiii) Breakage data (by race and track/event);
(xiv) Commission data (by race and track/event); and
(xv) Purged data (by ticket and total).
(4) The system shall generate the following reports:
;
(x) Voids (by ticket, writer, and total);
(xi) Future wagers (by ticket, date of event, total by day, and total at the time of revenue recognition);
(xii) Results (winners and payout data);
(xiii) Breakage data (by race and track/event);
(xiv) Commission data (by race and track/event); and
(xv) Purged data (by ticket and total).
(4) The system shall generate the following reports:
(i) A reconciliation report that summarizes totals by track/event, including write, the day's winning ticket total, total commission and breakage due the gaming operation, and net funds transferred to or from the gaming operation's bank account;
(ii) An exception report that contains a listing of all system functions and overrides not involved in the actual writing or cashing of tickets, including sign-on/off, voids, and manually input paid tickets; and
(iii) A purged ticket report that contains a listing of the unique transaction identifier, description, ticket cost and value, and date purged.
(h) Accounting and auditing functions. A gaming operation shall perform the following accounting and auditing functions:
(1) The pari-mutuel audit shall be conducted by someone independent of the pari-mutuel operation.
(2) Documentation shall be maintained evidencing the performance of all pari-mutuel accounting and auditing procedures.
(3) An accounting employee shall review handle, commission, and breakage for each day's play and recalculate the net amount due to or from the systems operator on a weekly basis.
(4) The accounting employee shall verify actual cash/cash equivalents turned in to the system's summary report for each cashier's drawer (Beginning balance, (+) fills (draws), (+) net write (sold less voids), (-) payouts (net of IRS withholding), (-) cashbacks (paids), (=) cash turn-in).
(5) An accounting employee shall produce a gross revenue recap report to calculate gross revenue for each day's play and for a month-to-date basis, including the following totals:
urned in to the system's summary report for each cashier's drawer (Beginning balance, (+) fills (draws), (+) net write (sold less voids), (-) payouts (net of IRS withholding), (-) cashbacks (paids), (=) cash turn-in).
(5) An accounting employee shall produce a gross revenue recap report to calculate gross revenue for each day's play and for a month-to-date basis, including the following totals:
(i) Commission;
(ii) Positive breakage;
(iii) Negative breakage;
(iv) Track/event fees;
(v) Track/event fee rebates; and
(vi) Purged tickets.
(6) All winning tickets and vouchers shall be physically removed from the SAM's for each day's play.
(7) In the event a SAM does not balance for a day's play, the auditor shall perform the following procedures:
(i) Foot the winning tickets and vouchers deposited and trace to the totals of SAM activity produced by the system;
(ii) Foot the listing of cashed vouchers and trace to the totals produced by the system;
(iii) Review all exceptions for propriety of transactions and unusual occurrences;
(iv) Review all voids for propriety;
(v) Verify the results as produced by the system to the results provided by an independent source;
(vi) Regrade 1% of paid (cashed) tickets to ensure accuracy and propriety; and
(vii) When applicable, reconcile the totals of future tickets written to the totals produced by the system for both earned and unearned take, and review the reports to ascertain that future wagers are properly included on the day of the event.
(8) At least annually the auditor shall foot the wagers for one day and trace to the total produced by the system.
o ensure accuracy and propriety; and
(vii) When applicable, reconcile the totals of future tickets written to the totals produced by the system for both earned and unearned take, and review the reports to ascertain that future wagers are properly included on the day of the event.
(8) At least annually the auditor shall foot the wagers for one day and trace to the total produced by the system.
(9) At least one day per quarter, the auditor shall recalculate and verify the change in the unpaid winners to the total purged tickets.

§ 542.12 What are the minimum internal control standards for table games? (a) Computer applications. For any computer applications utilized, alternate documentation and/or procedures that provide at least the level of control described by the standards in this section, as approved by the Tribal gaming regulatory authority, will be acceptable.
(b) Standards for drop and count. The procedures for the collection of table game drop boxes and the count of the contents thereof shall comply with this part as it is applicable to table game drop and table game soft count.
(c) Fill and credit standards. (1) Fill slips and credit slips shall be in at least triplicate form, and in a continuous, prenumbered series. Such slips shall be concurrently numbered in a form utilizing the alphabet and only in one series at a time. The alphabet need not be used if the numerical series is not repeated during the business year.
(2) Unissued and issued fill/credit slips shall be safeguarded and adequate procedures shall be employed in their distribution, use, and control. Personnel from the cashier or pit departments shall have no access to the secured (control) copies of the fill/credit slips.
only in one series at a time. The alphabet need not be used if the numerical series is not repeated during the business year.
(2) Unissued and issued fill/credit slips shall be safeguarded and adequate procedures shall be employed in their distribution, use, and control. Personnel from the cashier or pit departments shall have no access to the secured (control) copies of the fill/credit slips.
(3) When a fill/credit slip is voided, the cashier shall clearly mark “void” across the face of the original and first copy, the cashier and one other person independent of the transactions shall sign both the original and first copy, and shall submit them to the accounting department for retention and accountability.
(4) Fill transactions shall be authorized by a pit supervisor before the issuance of fill slips and transfer of chips, tokens, or cash equivalents. The fill request shall be communicated to the cage where the fill slip is prepared.
(5) At least three parts of each fill slip shall be utilized as follows:
(i) One part shall be transported to the pit with the fill and, after the appropriate signatures are obtained, deposited in the table game drop box;
(ii) One part shall be retained in the cage for reconciliation of the cashier bank; and
(iii) For computer systems, one part shall be retained in a secure manner to insure that only authorized persons may gain access to it. For manual systems, one part shall be retained in a secure manner in a continuous unbroken form.
(6) For Tier C gaming operations, the part of the fill slip that is placed in the table game drop box shall be of a different color for fills than for credits, unless the type of transaction is clearly distinguishable in another manner (the checking of a box on the form shall not be a clearly distinguishable indicator).
(7) The table number, shift, and amount of fill by denomination and in total shall be noted on all copies of the fill slip. The correct date and time shall be indicated on at least two copies.
ifferent color for fills than for credits, unless the type of transaction is clearly distinguishable in another manner (the checkin

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/FR_PRORULE_01-30788. Check the current official text before relying on it. Not legal advice.