Would Georgie’s “Teddy Bear Casino” from Young Sheldon actually be legal?
<p>On the TV series Young Sheldon, Connie secretly runs an illegal casino (slot machines and card games where you can earn cash), which is shut down by the police.</p>
<p>Connie’s grandson Georgie thinks she can reopen the casino by making all the games only give out prize tickets, which can be redeemed for teddy bears, and then adding a side desk where Connie buys back bears for $100 each.</p>
<p>Would this really be legal?</p>

<p>Potentially -- this is almost exactly how Pachinko parlors in Japan operate, with non-cash prizes being given out, but with &quot;known&quot; nearby establishments (sometime located in the same physical building) that will buy them for cash. Other options include the giving of vouchers/gift cards as prizes.</p>
<p>Whether this is legal or not is a question of if the buyer is &quot;truly&quot; acting independent of the gambling establishment. The general legal term for this is &quot;arm's length transactions&quot;.</p>
<p>A completely unrelated organization is presumed to be acting in its own best interest, in an &quot;arm's length&quot; manner, though this can be overcome with evidence of collusion. If the casino is willing to &quot;buy back&quot; its marker at a given price (much like Las Vegas casinos are required to do), this can be done with independent intermediary negotiators in a legitimate arm's length transaction.</p>
<p>In the Japan example above a &quot;three-shop system&quot; of nominally independent shops circle goods between them to effectively &quot;legalize&quot; (or at least not draw the ire of authorities over) cash gambling payouts.</p>

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<h3>It's been used in other places legally.</h3>
<p>I don't know whether or not it'd be legal in Texas, but similar schemes have been used legally in other places. For example, in Queensland, Australia, during the 1930s, what eventually became the <a href="https://en.wikipedia.org/wiki/Golden_Casket" rel="noreferrer">Golden Casket</a> lottery corporation originally bypassed now-repealed anti-gambling laws by running a lottery that awarded the titular &quot;golden casket&quot; as its prize, which was then bought back by the organization running the lottery for a sum of money that was the de facto cash prize.</p>

united-states texas gambling law-in-fiction