The Kickapoo Traditional Tribe of Texas believes lottery couriers are operating illegal gambling in the state and urging the Texas Lottery and legislators to take action. The Tribe has implied it might unilaterally pursue its own gaming expansion without the state’s involvement if the situation doesn’t change.
The tribe submitted a letter to the Senate State Affairs Committee last month. It focused on the threats that these online lottery services pose to current state laws when it comes to gambling.
In the letter, the Kickapoo suggested that courier services effectively act as a random number generator (RNG) to simulate real-time online games of chance. In their opinion, that qualifies them as a Class III gambling product. That’s a catch-all category for products that aren’t Class I or Class II, and includes casino games and sports betting.
Currently, the Kickapoo operate a facility offering only bingo, electronic bingo, and player-banked poker—all Class II products. However, the Indian Gaming Regulatory Act (IGRA) specifies that any Class III games offered elsewhere in the state must be made available to tribes. By defining lottery couriers as RNG-driven real-time games of chance, the Tribe appears to be arguing that it should be able to launch its own online casinos.
The state may challenge that interpretation. However, by the Kickapoo logic, the state would have to negotiate in good faith to allow the tribe to offer similar products. Failing that, the tribe could opt out of state regulation and seek permission directly from the federal Department of the Interior.
Meanwhile, the Texas Lottery claims it can’t take action against lottery couriers itself. It is awaiting instruction from legislators on whether to regulate or ban these third-party services.
Texas has been an important market for lottery couriers, and until now, amendable to their presence. Newcomer Jackpot.com even used Texas as its jumping-off point into the US market.
Tribe feels couriers impact their lawful gaming
The Kickapoo want to see a prohibition on the couriers in Texas, or at least severe restrictions on how they operate.
In the letter to the Senate State Affairs Committee, the tribe notes the following issues with the lottery courier business model:
- Purchasing a lottery ticket online from an app through a courier is a workaround for the state’s laws against internet gambling and purchasing lottery tickets through a telephone
- Texas prohibits lottery sales by a person who is not a licensed sales agent or employee of a sales agent
Couriers are able to avoid both of these issues by purchasing their customers’ orders at in-person retail locations. They send players confirmation of the purchase but retain physical possession of the tickets until winners have been determined. Delivery to the player happens only in the case of a large win that requires the ticket owner to claim it personally.
The Kickapoo aren’t buying the operations as legitimate and they see it as a threat to their livelihood, as noted in the letter.
These lottery courier services are operating contrary to the law and represent a significant expansion of gambling in the state. As such, these lottery courier services must be prohibited.
The existence and ongoing proliferation of online lottery sales directly harms the Tribe and severely detracts from the Tribe’s lawful gaming facility, which is vital to the Tribe and its ability to generate essential governmental revenue to provide for its members.
As an alternative to a complete ban, they propose a rule that would require couriers to arrange physical delivery of all tickets before any draw takes place. However, the logistics of that would likely render the courier business unviable and amount to a ban in practice.
It’s the fact that the tickets remain in the courier’s possession that, according to the tribe, makes them effectively the RNG for an online game.
Texas Lottery awaiting direction from lawmakers
The Texas Lottery has heard the complaints about lottery couriers.
However, they believe they don’t have the authority to take action against the companies.
During a meeting with the Senate State Affairs Committee last month, Executive Director of the Texas Lottery Ryan Mindell stressed a need for legislative guidance.
The lottery is not authorizing the sale of these tickets online, and we don’t have any regulatory jurisdiction over what happens after this ticket is sold at the brick-and-mortar location.
We’re very mindful and respectful that the legislature is the source of authority. If there is a gray area, then we do not want to go into that gray area without clear direction from this body that it’s okay to do that.
Mindell noted that the tickets couriers provide to their customers are purchased legally. His suggestion to the committee was to either ban couriers or allow his organization to regulate them.
Currently, five different couriers operate in Texas. They are:
- Jackpocket
- Jackpot.com
- Lotto.com
- theLotter
- Mido Lotto
Casino legislation not getting support for 2025
The Kickapoo’s desire to expand casino gaming in the state is not something that seems to be a priority for lawmakers.
Lt. Gov. Dan Patrick, who leads the Texas Senate, is dismissing the prospects of commercial casino legislation being brought forth during the 2025 legislative session. That’s aside from tribal casino expansion that the tribe is seeking.
Patrick, a Republican, has stressed that he won’t consider the topic until a majority of his colleagues in the Senate are backing it.
Currently, only a handful of the 20 Republicans in the Senate are in support of casino expansion.
