Am I allowed to use FundRazr to hold a raffle?

Crowdfunding Advisors Campaign Settings

Am I allowed to use FundRazr to hold a raffle?

Campaign Settings
— Updated: August 7, 2020

For most cases, the answer is no.

Why not?

Under the laws and regulations that apply to our system, the FundRazr Crowdfunding Network is not allowed to host online contests, lotteries, raffles, pyramid schemes, gambling activities or any other form of prohibited financial activity

The laws and regulations in question may include state and federal laws, Facebook regulations, and both PayPal and WePay regulations.

Here’s an example of what is allowed and what is not allowed:

Scenario 1 (allowed)

  • Everyone who donates at least $50 will receive a signed copy of our new album

Scenario 2 (not allowed) 

  • Everyone who donates at least $10 will have their names placed into a hat and one person will win a signed copy of our new album

Why is scenario 2 not allowed? 

If everyone who donates at a certain level receives the same reward, then it’s not considered gambling, because there is no risk involved for any of your donors. The donors know that if they donate $50 they will receive a signed copy of your new album. 

When only one person who donates receives a reward, then it turns into online gambling, because there is risk involved for everyone who donates. The donors hope that if they donate $10 they will receive a signed copy of your new album, but they are not guaranteed to receive this prize.

This is considered online gambling and we are NOT ALLOWED to host online gambling on our platform.

What can I do instead of a raffle?

If you want to use our system to sell tickets to an event and then separately sell raffle tickets at the event then that would be fine, but anything related to online could gambling cause you legal issues. 

You can also use our Incentives feature to offer incentives for people to contribute to your campaign. Be creative. Some of our most successful campaigns offer a simple “We’ll post a thank you note to you on our Facebook Page” Perk for a $5 contribution, and get a lot of $5 contributions as a result. 

If you only have one of the item you wanted to raffle off, consider offering that item as a Incentive instead (click here to find out how to add an Incentive), but make sure you’re getting your money’s worth out of it and limit the quantity of the Incentive to 1.

*Unless you have a valid online gaming licence from your state or local authority, AND you have provided both us and the Payment Provider with a copy of it before creating your campaign, AND the Payment Provider has given you written confirmation that you are okay to proceed.

Please note that it is your responsibility to ensure that you are following all laws and regulations in your jurisdiction. If we receive a report of a campaign running a raffle or any other form of online gambling, that campaign may be suspended without notice, and PayPal and/or Stripe may be notified, at which point all funds in that PayPal and/or Stripe account(s) may be held or returned to the contributors.