Chapter 565

565.30(6m)(c)5. 5. The prize winner, by sworn affidavit, provides the court with an accounting of all claims to, or judgments, liens, security interests, garnishments, assignments or attachments against, all or any part of the lottery prize payments.

565.30(6m)(c)6. 6. The prize winner provides the court a certification from the administrator that lists the amounts of the lottery prize payments, if any, that the administrator is required to withhold for the prize winner under subs. (4), (5), (5m) and (5r).

565.30(6m)(c)7. 7. The part of the lottery prize that is being used as security for the loan does not include the amounts of any withholdings specified under subs. (4), (5), (5m) and (5r).

565.30(6m)(c)8. 8. The court determines that the interest rate on the loan does not exceed the weekly prime rate for the week prior to the date on which the court received a copy of the contract, as reported by the federal reserve board in federal reserve statistical release H. 15, plus 6 percent. In making the calculation under this subdivision, the court shall subtract from the compensation received by the individual or organization making the loan any required fees or other costs charged the prize winner.

565.30(6m)(d) (d) Contents of court order. A court order issued under par. (c) shall include all of the following:

565.30(6m)(d)1. 1. The name of the prize winner.

565.30(6m)(d)2. 2. The prize winner’s social security number if the prize winner is an individual, or federal income tax identification number if the prize winner is an organization.

565.30(6m)(d)3. 3. The name of the individual or organization that is making the loan to the prize winner.

565.30(6m)(d)4. 4. The social security number of the individual or the federal income tax identification number of the organization that is making the loan to the prize winner.

565.30(6m)(d)5. 5. If an individual is making the loan to the prize winner, the citizenship of the individual. If the individual is not a citizen of the United States of America, the order shall include the individual’s resident alien number.

565.30(6m)(e) (e) Administration. Upon receipt of a court order issued under par. (c), the individual or organization making the loan shall provide a certified copy of the court order to the administrator. The administrator shall acknowledge receipt of the court order in writing to the individual or organization making the loan and shall make all lottery prize payments according to the terms specified in the court order. The administrator may charge an initial processing fee, in an amount determined by rule, to cover any costs associated with processing the lottery prize payments in accordance with the terms specified in the court order.

565.30(6r) (6r) Voluntary assignment of lottery prize.

565.30(6r)(a) (a) Definition. In this subsection, “assignor” means a lottery prizewinner or a person who has the right to assign all or part of a lottery prize.

565.30(6r)(b) (b) Voluntary assignment. An assignor may make a voluntary assignment of a lottery prize or part of a lottery prize only pursuant to a court order issued under this subsection.

565.30(6r)(c) (c) Judicial process for assignment. Any assignor who intends to voluntarily assign part or all of a lottery prize to any individual or organization shall petition the circuit court of the county in which the assignor resides or the circuit court of Dane County for a court order confirming the assignment. The circuit court of the county in which the assignor resides or the circuit court of Dane County shall issue an order confirming the assignment only if all of the following occur:

565.30(6r)(c)1. 1. The assignor is represented by independent legal counsel.

565.30(6r)(c)2. 2. A copy of the assignment is attached to the petition.

565.30(6r)(c)3. 3. The assignment is in writing, is executed by the assignor and is subject to the laws of this state.

565.30(6r)(c)3m. 3m. The contract for the assignment provides that the assignor has the right to cancel the contract until midnight of the 3rd business day after the date on which the assignor entered into the contract.

565.30(6r)(c)3r. 3r. The contract for the assignment provides that the assignor, from the proceeds received from the individual or organization to whom part or all of the lottery prize is assigned, agrees to pay in full any delinquent payments that may be owed by the assignor under subs. (4), (5), (5m) and (5r).

565.30(6r)(c)4. 4. The assignor attests, by sworn affidavit, that he or she is of sound mind, is not acting under duress and acknowledges that the state will not make any of the assigned lottery prize payments or parts of lottery prize payments to the assignor.

565.30(6r)(c)5. 5. The assignor, by sworn affidavit, provides the court with an accounting of all claims to, or judgments, liens, security interests, garnishments, assignments or attachments against, all or any part of the lottery prize payments.

565.30(6r)(c)6. 6. The assignment does not include the amounts of any withholdings specified under sub. (4), (5), (5m) or (5r).

565.30(6r)(c)7. 7. The assignor provides the court a certification from the administrator that lists the amounts of the lottery prize payments, if any, that the administrator is required to withhold for the assignor under subs. (4), (5), (5m) and (5r).

565.30(6r)(c)8. 8. The payment that the assignor will receive as compensation for the assignment is at least equal to the present value of the assigned lottery prize payments, discounted at a rate no greater than the weekly prime rate for the week prior to the date on which the court received a copy of the assignment, as reported by the federal reserve board in federal reserve statistical release H. 15, plus 6 percent. In making the calculation under this subdivision, the court shall subtract from the compensation received by the assignor any required fees or other costs charged the assignor.

565.30(6r)(c)9. 9. The individual or organization to whom part or all of the lottery prize is assigned specifies in an affidavit that the individual or organization agrees to report and pay any state income or franchise tax that is owed on any income or gain realized from the purchase and subsequent sale or redemption of any lottery prize.

565.30(6r)(c)10. 10. The individual or organization to whom part or all of the lottery prize is assigned specifies in an affidavit that the individual or organization agrees to withhold from any payment made to an assignor for the assignment of a lottery prize the amount calculated under s. 71.67 (5m) and agrees to deposit that amount as required under s. 71.67 (5m).

565.30(6r)(d) (d) Contents of court order. A court order issued under par. (c) shall include all of the following:

565.30(6r)(d)1. 1. The name of the prizewinner or the name of the assignor, if different from the prizewinner.

565.30(6r)(d)2. 2. The assignor’s social security number if the assignor is an individual, or federal income tax identification number if the assignor is an organization.

565.30(6r)(d)3. 3. The name of the individual or organization to whom part or all of the lottery prize is assigned.

565.30(6r)(d)4. 4. The social security number of the individual or the federal income tax identification number of the organization to whom part or all of the lottery prize is assigned.

565.30(6r)(d)5. 5. If part or all of the lottery prize is assigned to an individual, the citizenship of the individual. If the individual is not a citizen of the United States of America, the order shall include the individual’s resident alien number.

565.30(6r)(d)6. 6. The number of assigned lottery prize payments and the dates on which the assigned lottery prize payments are to be paid.

565.30(6r)(d)7. 7. The gross amount of each of the lottery prize payments that are subject to withholding for tax purposes and that are assigned.

565.30(6r)(e) (e) Administration of lottery prize assignment. Upon receipt of a court order issued under par. (c), the individual or organization to whom the lottery prize is assigned shall provide a certified copy of the court order to the administrator. The administrator shall acknowledge receipt of the court order in writing to the individual or organization to whom the lottery prize is assigned and shall make all lottery prize payments according to the terms specified in the court order. The administrator may charge an initial processing fee, in an amount determined by rule, to cover any costs associated with processing the lottery prize payments in accordance with the terms specified in the court order.

565.30(7) (7) Payment from terminals prohibited. If computer terminals or other devices are used to play lottery games, no coins or currencies may be dispensed, as prizes, to players from the terminals or devices.

565.30 History History: 1987 a. 119, 399; 1989 a. 31; 1989 a. 56 s. 259; 1989 a. 359; 1991 a. 269; 1993 a. 16, 481; 1995 a. 27 ss. 6981j, 6981k, 9126 (19); 1995 a. 225, 404; 1997 a. 3, 27, 35; 1997 a. 148 ss. 3 to 5; 1997 a. 191; 1999 a. 9, 185, 194; 2005 a. 387; 2005 a. 443 s. 265; 2007 a. 20; 2009 a. 402; 2011 a. 257; 2013 a. 20, 54; 2017 a. 17; 2019 a. 95; 2021 a. 35; 2023 a. 146.

565.30 Annotation Advising Lottery Winners. MacGregor & Gawart. Wis. Law. July 1994.

565.32 565.32 Promotional advertising; advertising, ticket and share contents.

565.32(1) (1) Promotional advertising prohibition. The expenditure by the department or any other state agency of public funds or of revenues derived from lottery operations to engage in promotional advertising of the state lottery or any multijurisdictional lottery is prohibited.

565.32(2) (2) Promotional advertising by retailers or vendors.

565.32(2)(a) (a) A retailer or a combination of retailers, a vendor or a combination of vendors or a combination of retailers and vendors may engage in promotional advertising of the state lottery or any multijurisdictional lottery in which the state participates.

565.32(2)(b) (b) Promotional advertising by vendors under par. (a) shall clearly indicate that the advertising is paid for by the vendor.

565.32(3) (3) Required contents of advertising, tickets and shares.

565.32(3)(a) (a) Any advertising, as defined by the department by rule under s. 565.02 (3) (f), of the lottery which describes a specific lottery game and each lottery ticket and lottery share shall include:

565.32(3)(a)1. 1. Except for the games under subd. 2., the prize structure, the prize amounts and the odds of a specific lottery ticket or lottery share being selected as the winning lottery ticket or lottery share for each prize amount.

565.32(3)(a)2. 2. For games in which the amount of the winnings and the odds of winning are determined by the number of participants in the game, all of the following:

565.32(3)(a)2.a. a. An explanation that the amount of the winnings and the odds of winning are determined by the number of participants in the game.

565.32(3)(a)2.b. b. An explanation of the prize structure.

565.32 History History: 1987 a. 119; 1989 a. 31; 1991 a. 269; 1995 a. 27; 1997 a. 27; 2023 a. 146.

565.37 565.37 Audits, financial reports and odds verification.

565.37(1) (1) Financial and performance audits. The department shall annually contract with the legislative audit bureau to conduct a financial audit of the transactions and accounts of the state lottery, and, to the extent of the department’s participation, of any multijurisdictional lotteries in which the state participates, for the preceding fiscal year and shall, if the state auditor or the joint legislative audit committee directs that a performance audit be conducted, contract with the legislative audit bureau for a performance audit of the state lottery and, to the extent of the department’s participation, of those multijurisdictional lotteries.

565.37(2) (2) Independent postaudit. At no less than 3-year intervals, the department may retain an independent certified public accountant to conduct a postaudit of all the lottery division’s accounts and transactions. The department shall provide copies of each such postaudit to the legislative audit bureau and the department of justice.

565.37(3) (3) Department report. The department shall submit quarterly reports on the operation of the lottery to the chief clerk of each house of the legislature, for distribution to the legislature under s. 13.172 (2) and to the governor, attorney general, secretary of administration, secretary of state, and state auditor.

565.37(4) (4) Administrator report. The administrator shall submit monthly financial reports to the secretary of revenue.

565.37(5) (5) Verification of odds. The department shall contract with the legislative audit bureau to verify the odds on winning a lottery game that are represented by the department, a contractor or a retailer.

565.37(6) (6) Audit of lottery security. By July 1, 1990, and at least biennially thereafter, the department shall hire an independent firm to perform an audit of lottery security that is independent of any other audit under this section.

565.37 History History: 1987 a. 119; 1989 a. 31; 1991 a. 269; 1995 a. 27, 438; 1997 a. 27, 148; 2003 a. 33; 2013 a. 8.

565.40 565.40 Enforcement authority.

565.40(1) (1) Investigations. The department of justice may investigate any activities by vendors or employees in the department, which affect the operation or administration of the state lottery or any multijurisdictional lottery in which the state participates, and shall report suspected violations of state or federal law to the appropriate prosecuting authority.

565.40(1m) (1m) Subpoena power. For the purpose of an investigation under sub. (1), the attorney general may issue a subpoena to compel the production of any books, papers, correspondence, memoranda, agreements or other documents or records which the attorney general deems relevant or material to the investigation. Section 885.12 shall apply to any failure to obey a subpoena under this subsection.

565.40(2) (2) Prosecutions. The attorney general and district attorneys have concurrent jurisdiction to commence prosecutions for alleged violations of this chapter.

565.40(3) (3) Background investigation.

565.40(3)(a) (a) In this subsection:

565.40(3)(a)1. 1. “Secured area” means any areas where sensitive information is stored or accessible and any areas associated with the lottery with limited or controlled access.

565.40(3)(a)2. 2. “Sensitive information” means any report or study containing trade secrets, as defined in s. 134.90 (1) (c); any process or production technique which is unique to the lottery; any information or documentation the disclosure of which would adversely affect the security or the competitive position of the lottery; any individual’s mailing address, e-mail address, telephone number, or social security or federal employer identification number; any financial account numbers; any personnel or employee information; any employee or vendor background investigation documents; any personal information provided by retailers for contracting purposes; and any personally identifiable information, as defined in s. 19.62 (5).

565.40(3)(b) (b) The department of revenue, with the assistance of the department of justice, may conduct a background investigation of any person who may come into contact with any sensitive information associated with the lottery or who may have access to secured areas. The department of revenue may require the person to be photographed and fingerprinted. The department of justice may submit the fingerprints to the federal bureau of investigation for the purpose of verifying the identity of the person fingerprinted and obtaining records of his or her criminal arrests and convictions. The department of revenue, with the assistance of the department of justice, shall repeat the background investigation of each person under this subsection every 5 years. The department of revenue shall reimburse the department of justice for the department of justice’s services under this subsection.

565.40(4) (4) Police powers. The department may enforce violations of this chapter, and special agents may exercise their arrest authority under s. 73.031 to enforce violations of this chapter. This subsection does not deprive or relieve other law enforcement or peace officers of the power and duty to enforce violations of this chapter.

565.40 History History: 1987 a. 119; 1989 a. 31; 1991 a. 269; 1995 a. 27; 1997 a. 27; 2017 a. 17; 2023 a. 73.

565.45 565.45 Report on expense limitation. Before January 1, 2002, and every 2 years thereafter, the department shall submit a report to the chief clerk of each house of the legislature, for distribution to the legislature under s. 13.172 (2), on the effects on the operation of the lottery of the 10 percent expense limitation under s. 25.75 (3) (b).

565.45 History History: 1987 a. 119; 1991 a. 269; 1995 a. 27; 1997 a. 27; 1999 a. 9.

565.46 565.46 Minority advertising, procurements, retailers and hiring. The department shall promulgate rules establishing goals that attempt to increase the total amount of expenditures by the department for advertising, public relations and other procurements that are directed to minority businesses, the number of retailers that are minority businesses and the number of employees of the lottery division in the department who are minority group members.

565.46 History History: 1991 a. 39, 269; 1995 a. 27; 1997 a. 27.

565.48 565.48 Collection of unpaid liabilities. Any unpaid amount owed by a retailer to the department under this chapter shall be assessed, collected, and reviewed in the same manner as income taxes are assessed, collected, and reviewed under ch. 71.

565.48 History History: 2005 a. 25.

565.50 565.50 Penalties.

565.50(1) (1) Any person who violates s. 565.02 (2m), 565.05, 565.10 (3m), 565.17, 565.25 (3m) or 565.32 (1), (2) (b) or (3) or any rule promulgated under s. 565.02 (2m), 565.05, 565.10 (3m), 565.17, 565.25 (3m) or 565.32 (1), (2) (b) or (3) shall be fined not more than $10,000 or imprisoned for not more than 9 months or both.

565.50(2) (2) Any person who alters, forges, counterfeits, or illegally obtains a lottery ticket or share or intentionally utters or transfers an altered, forged, counterfeit, or illegally obtained lottery ticket or share is guilty of a Class I felony.

565.50(2m) (2m) Any person who claims a lottery prize from a winning lottery ticket or share and then transfers the same winning lottery ticket or share to another person is guilty of a Class I felony.

565.50(3) (3) Any person who possesses an altered, forged, counterfeit, or illegally obtained lottery ticket or share, or a winning lottery ticket or share for which the prize has been previously claimed, with intent to defraud shall be fined not more than $10,000 or imprisoned for not more than 9 months or both.

565.50(4) (4) Any person who transfers a lottery ticket or share to another person, presents a transferred lottery ticket or share for payment of a lottery prize, or claims a lottery prize from a transferred ticket or share with intent to avoid withholding under s. 565.30 (4), (5), (5m), or (5r) shall be fined not more than $10,000 or imprisoned for not more than 9 months or both.

565.50 History History: 1987 a. 119; 1997 a. 283; 2001 a. 109; 2023 a. 73.