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LEGAL AND INSTITUTIONAL FRAME WORK FOR GAMBLING/ONLINE GAMBLING IN NIGERIA

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Abstract

Gambling activities in our society can be said to be as old as man itself. Evolving from being a recreational activity to a means for generation of income with the skills of players becoming of almost importance. While Gambling has an age long history, the means through which gambling is taking place has also witness a great deal of changes. The emanation of Information Communications Technology and the Internet, came a change of medium, therefore legislation must keep up with the paste.
LEGAL AND INSTITUTIONAL FRAME WORK FOR GAMBLING/ONLINE
GAMBLING IN NIGERIA
Onuche Samson Ojodomo
Abstract
Gambling activities in our society can be said to be as old as man itself. Evolving from being a
recreational activity to a means for generation of income with the skills of players becoming of almost
importance. While Gambling has an age long history, the means through which gambling is taking
place has also witness a great deal of changes. The emanation of Information Communications
Technology and the Internet, came a change of medium, therefore legislation must keep up with the
paste. This article assesses the Legal and Institutional Framework for Gambling/Online Gambling in
Nigeria, it exposes the nature of Gambling/Online Gambling, historical regulations in Nigeria, legal
forms in which gambling exist in Nigeria, current legislation, making recommendation for possible
reforms. It also enlightens the Gambling/Gaming Sector, Stakers/Bettors, the government and all
stakeholders of the Gambling industry in Nigeria and the laws regulating the industry. And it is limited
to the Lagos State Lottery Board Law 2008, in its examinations of states regulations relating to
gambling.
Keywords: Gambling, Online, Internet, E-Commerce, Information, Communications
I. Introduction
Gambling has over the years been part and parcel of the society, it can be
traced from the ancient and primitive time to modern day society. Gambling as an
activity, is as old as the human society itself as people from time immemorial have
often place wages on certain out comes of future events of life. For the vast majority
of players, Gambling is an enjoyable form of leisure, pursued for a range of reasons –
to relax, to socialize, to experience some excitement, and perhaps to win money. To
these categories of individuals, losses incurred on Gambling are simply the price one
has to pay for the entertainment, in much the same way as cinema or football tickets
are the cost of a good time.1
Gambling activities has over the years evolve into various forms and kinds.
And is currently referred to as Betting and Lottery by a wide range of the population.
However, there are arguments that Betting is not the same as Gambling.2 In that, in
Gambling, there is an inherent feeling of excitement from the participant, in
Onuche Samson Ojodomo, LL.B, BL, LL.M, PNM, E.I. ONUCHE & CO, Abuja, Nigeria,
Onuchesamson48@gmail.com +2348173928587, +2347062476178
1 Agbala E.S.,‘Mapping the Nigeria Gaming Industry: Legal & Socio-Cultural Factors.’ (2016)’
American Gaming Lawyer.Autumn < https://www.imgl.org/sites/> Accessed 19 August 2018
2 Fatimah Waziri –Azi “Regulatory & Legal Framework for Online Sports Betting in Nigeria: A Viable
Alternative for Money Laundering” International Journal of Law and Legal Jurisprudence Studies:
Volume 2 Issue
Onuche Samson Ojodomo
anticipation of preferred outcome turning up in their favour.3 And most importantly,
in Gambling, the historical performance and antecedence of the object of the said
gamble does not affect the outcome even though people try to use statistics to predict
the outcome. Therefore, it is said that Gambling, typically involved game of chance
that is based upon probability or luck and has nothing to do with the skills of a
person.4
Betting on the other hand is an agreement between two persons, usually the
Bettor and the Betting Company. Where the Betting Company provides the bookies
and the other person makes prediction on the outcome of an event using the bookies.
The individual either forfeits the amount waged in case of incorrect prediction or the
Betting Company pays a higher amount as per the agreed terms if the prediction turns
out to be correct. Here, historical performance and statistics are factors used to
predict results.5
However, the word “Betting” and “Gambling” in this research will be used
interchangeably, being that in the clear sense of the concept of these words, they stand
to mean one and the same. Even though a distinction is made, this article views the
distinction as being capable to be made as a result of the modern realities which
brought about the use of antecedence for predictions.
With the advent of modern Information and Communications Technological
(ICT) and the Internet, Gambling activities transcended from the old trend of
Physical/Landed Gambling to Cyberspace, with Internet creating a new trend of
Gambling commonly referred to as Online Gambling. Online Gambling has now form
part and parcel of Electronic Commerce (E-Commerce) falling under the subject area
of Information Communications Technology Law dealing with Finance such as E-
Money, E-payment and M- Payment. Therefore, ascertaining the Legal and
Institutional framework regulating Gambling/Online Gambling is very vital.
II. Gambling
According to the Britannica Online Encyclopedia, Gambling is defined as the
betting or staking of something of value, with consciousness of risk and hope of gain,
3 Ibid
4 Ibid
5 Ibid
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on the outcome of a game, a contest, or an uncertain event whose result may be
determined by chance or accident, or it may have an unexpected result by reason of
the bettor’s miscalculation.6 The term ‘Gambling” involves a wide-ranged concept
that includes a different variety of activities, such as Gambling in Bingo halls,
Gambling though the use of machines, betting on races, Casinos and amusement
arcades, as well as playing the Lottery either on Land base or through the Internet
Cyberspace.7
a. Online Gambling
According to Casinopedia Online, Online Gambling is any form of gambling
game which is played using a computer or mobile device and the internet connection,
this can be referred to as Online Gambling.8 In the same vein, the European Union
(EU) defines Online Gambling services as any service that involves wagering a stake
with monetary value in games of chance, including lotteries and betting transactions
that are provided at a distance, by electronic means and at the individual request of a
recipient service.9Online gambling employs the boarder less medium of the internet to
deliver its services10
b. E-Commerce
Electronic Commerce, consists of the buying and selling of products or
services over electronic systems such as the Internet and other Computer Networks.11
It has also been defined as the exchange of information across electronic networks at
any stage in the supply chain, which could be either within an organization,
businesses, businesses and consumers or between the public and private sectors
6Britannica Online Encyclopaedia “Gambling”
<http://www.britannica.com.oasis.unisa.ac.za/EBchecked/topic/2248636/gambling>). Accessed 19
/09/2018.
7 Omachi, S.A, Okpamen K. O “The changing patterns of Gambling in Benue State the case of
emerging roles of ICT(Information and Communication Technology) in Contemporary Markurdi
Metropolis.’ 27th April, 2018 American Association for Science and Technology AASCIT Vol 5, Issue 2
8 Online Casinopedia <https://www.casinopedia.org/terms/online-gambling> Accessed 20/09/2018.
9 Salvatore Casabona” The EU’s Online gaming regulatory approach and crises of legal modernity.
Working Paper No.17 January,2014.
10 John Mikler ‘Sharing Sovereignty for Global Regulation: The Cases of Fuel Economy and Online
Regulation & Governance’ 2008 Volume 2, Journal Compilation (Blackwell Publishing Asia Pty Ltd:
2008) 383–404
<doi:10.1111/j.1748-5991.2008. 00048.x> Accessed 1st September, 2019
11 Akintola K.G, Akinyede R.O.& Agbonifo C.O, ‘Appraising Nigeria Readiness For Ecommerce
Towards: Achieving Vision 2020’ November 2011, Vol 9 Issue 2, IJRRAS
<www.arpapress.com/Volumes/Vol9Issue2/IJRRAS_9_2_18.pdf> Accessed 30th August 2019
276
Onuche Samson Ojodomo
whether paid or unpaid.12 E-Commerce involves wide range of transactions such as,
Electronic Data Interchange (EDI), Supply Chain Management, Automated Data
Collection systems, Internet Marketing, Electronic Funds Transfer (EFT), Online
Transaction processing and Inventory Management Systems13
Some States of the Federation have Laws on Gambling or Lotteries, However,
focus will be streamline to Lagos State Lottery Board Law 2008 while discussing
regulations pertaining the States of the Federation primarily because under the said
Law, Eighteen(18) Online Betting operators have been Licensed, while 12 have
Temporary Licence and 14 have got their licence suspended,14and these Companies
carryout Online Gambling/Betting activities all over the federation. The National
Lotteries Commissions together with the Lagos State Lotteries Board have issued a
combine total of more than Eighty (80) Licences prompting need to access its Legal
framework and its institutional regulations.
III. Historical Regulations of Gambling in Nigeria
As a result of the receptive provisions of Nigeria Legislation, which received
and made English Legislation applicable to our jurisdiction,15 the first Gambling
Legislation applicable to Nigeria, was the Unlawful Games Act of 1541.16 The Act
was enacted by the Parliament of England to prohibit several other games that have
cause the decay of the sport of Archery.17 As a build up to the said Act, the House of
Lords Select Committee made recommendations in 1844 which resulted in the
enactment of the Gaming Act of 1845 in England.18 The said Act did not try to make
Gambling illegal, however, it was aimed at discouraging Gambling by making
contracts emanating from every Gambling activities unenforceable as a Legal
Contract.
12 Anthony Idigbe Nnamdi Oragwu & Okorie Kalu ‘Legal And Institutional Framework For E-
Commerce In Nigeria, Being A Paper Delivered At Bankers House Seminal Held 9th June 2010 Lagos,
Nigeria
13 Ibid
14 Online sport betting, Lagos State Lottery Board. <https://lslb.ig.gov.ng./osb/>. Accessed on 29th
April 29, 2018
15 Section 45 of the Interpretations Act No.1 January 1964, Section 14 of the Supreme Court
Ordinance of 1914.
16 The Unlawful Games Act of 1541 (33 Henry 8 Chapter 9).
17 Archery is the art, sport, practice, or skill of using a bow to shoot arrows. Historically, archery has
been used for hunting and combat. In modern times, it is mainly a competitive sport and recreational
activity.
18 The Gaming Act 1845, (8 & 9 Victorian Chapter 109) was assented on the 8th of August 1845. The
said Act was repealed In England on 1st September 2007.
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In 1853, the Betting Act of 1853 was enacted making it illegal to use or keep any
private property for the purpose of Gambling thereby outlawing any off-track
Gambling. The Act help to restrict betting to only Horse Racing and Track Race event
at the time. Over the past 40 years, Gambling laws have been enacted in Nigeria to
protect its citizens and to define punishments for illegal gambling activities. These
laws, provides penalties and punishments for playing illegal games, operating illegal
gaming houses, operating an illegal gaming machine and more.
The Laws regulating Gambling in Nigeria at present are numerous and cutting
across several legislations, which can be out-lined as follows:
1. The National Lottery Regulatory Commissions Act 2007.19
2. The Lagos State Lottery Board Law 200820
3. The Casino Taxation Act 1965.21
4. The Gaming Machines Prohibitions Act 197722
5. Criminal Code Act (1990)23
6. The Penal Code Act.
7. The Economic and Financial Crimes Commissions Act 2004.
8. Money Laundering Act 2004. 24
9. The Advance Fee Fraud Act.25
10. The Cybercrimes Act 2015.
11. The Constitution of the Federal Republic of Nigeria 1999.
19 No. 7.2005
20 Lagos State Lotteries Board Laws Cap. L89 2004 (Now Lagos State Lotteries Board (Amendment)
Law 2008.
21 Cap. C3 LFN 2004
22 Cap. G1 LFN 2004
23 Cap. C38 LFN 2004
24 Cap.M18 LFN 2004
25 Cap. A6 LFN 2004
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Onuche Samson Ojodomo
12. Companies and Allied Matters Act.26
IV. Legislative Jurisdiction on Gambling/Online Gambling in Nigeria
In Nigeria, it is doubtful to assert that an activity not expressly prohibited or
legislate upon is illegal.27 The provisions of Section 36(8) and also Section 36(12) of
the Constitution of the Federal Republic of Nigeria, 1999, supports this position of the
Law. Therefore, all forms of gambling not expressly prohibited or legislated upon is a
legal form of gambling, inclusive of Online Gambling under the National Lottery
Commissions Act. However, there has been a lot of legislative dichotomy and the
issue of dispute on who can legislate on issues relating to Gambling/Gaming. This is a
subject of controversy in the case of Attorney General of Lagos State v. Attorney
General of Federation28 pending before the Supreme Court.
Judicial decisions before now has not help to resolve these controversies as
seen in the case of National Lottery Regulatory Commission v. Attorney General
Lagos29 where the Federal High Court held that Lottery and Gaming falls within the
meaning of an Inter State Commerce and it is the exclusive competence of the
National Assembly to legislate on interstate Trade and Commerce.30 Therefore, a
holder of a licence can carry on business without any interference from the State as
held in the case of National Sports Lotteries Limited v. Attorney-General of Lagos
State.31
In the recent decision in the case of Edet v. Chagoon,32 the Court of Appeal
held that Pools Betting and Casino Gaming (Prohibition) Act is not within the
legislative competence of the National Assembly as same is not listed on the
Exclusive and Concurrent list and therefore falls within the residual competence of
26 Cap. C20, LFN, 2004
27 Araromi, Marcus, ‘Regulation of Gambling in Nigeria: A Need to Review the Status Quo’ (March
18, 2018 Accessed from< https://ssrn.com/abstract =3286593> Accessed 10th September 2019
28 Suit No. 01/2008
29 Suit No. FHC/L/CS/1258/2012
30 Paragraph 62(a) Second Scheduled of the 1999 Constitution of the Federal Republic of Nigeria (as
amended)
31 (2009) All FWLR PT 474
32 (2008) 2 NWLR (PT.1070)85
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states. The Constitution of the Federal Republic of Nigeria 1999 provides in Section
4(7) that the state shall have Residual Powers to legislate on items not contained in
the Exclusive List and the Concurrent List.33 Gambling not been provided for falls
under the residual list for the state to exercise legislative jurisdiction on. Therefore,
the provisions of Section 34(3) of the National Lottery Act 2007, in line with its
inconsistency with provisions of the Constitution is seen to be null and void and of no
effect as such provision cannot amend the clear provisions of the Constitution.
V. Legislative Framework
Gambling, regardless of its long existence and increasing familiarity, has
never been regarded as merely another business, free to off its wares or services to the
public.34 Instead it has always been a target of special scrutiny by governments in
every jurisdiction where it exists, even among gambling friendly states.35 The primary
assumptions, whether empirically based or not is that, Gambling Industry, when left
unregulated and subject only to market forces, would produce a number of adverse
impacts on society and the government is the most appropriate remedy to turn to for
Legislation regulating this Industry.36 Thus, the objective of regulation is to ensure the
integrity of the games offered. This function is often valued most by the proprietors of
gambling establishments, being that regulations is the most effective means of
ensuring that Legal Gambling exist and is operated in a fair and honest manner.37
Secondly, government concern in regulations is aimed at prevention of crime
such as an Organized Crime, and the volume of cash in the gambling sector could
easily bring about a situation of Money Laundering when not adequately monitored.38
Thus, the rationale behind statutory regulation is its command status. There is usually
a higher level of compliance with statutory regulations of the State than Non-
Statutory regulations produce by the Industry itself. Therefore, the Legislative and
Institutional framework for the regulation of Gambling and Online Gambling Industry
in Nigerian Gambling industry can be examine as follows: -
33 Section 4 of the CFRN 1999, Second Schedule Part 1 and 2 of the Constitution.
34 Micheal Belletire, ‘Regulating Casinos Gaming: A view from State Regulators, Administrators
Board of Illinois Board, Report Written for the NGISC at the request of the subcommittee on
Regulation, Enforcement, and the Internet.’ A Report to the National Gambling Impact Study
Commission (January1998)
35 Ibid
36 Ibid
37 Ibid
38 Ibid
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1. The National Lottery Commissions Act 2005
The National Lottery Regulatory Commission Act was passed by the senate on
22nd March 2005 and also the House of Representative on same date. The Act was
signed into Law by President Olusegun Obasanjo on the 30th March 2005.39 Gambling
sector in Nigeria, was grossly unregulated before the enactment of the Act and the Act
still represent the legislative measures for regulating the Gambling Industry
nationally. The Act is applicable to all Licenses operating immediately before the
commencement of the Act and such a License is deem to have been granted under the
Act.40
The Act is divided into 58 Sections, and it establishes the National Lotteries
Regulatory Commissions,41 which is a body a corporate with a perpetual succession
and a common seal.42 The Act established the National Lottery Regulatory
Commission Governing Board43 which consist of a Chairman and Ten (10) other
members, of which 6 must come from each of the six geopolitical zones44 and the
Federal Ministry of Commerce, the Federal Ministry of Finance, the Federal Ministry
of Sports45 and also the Director-General of the Commission46 the chairman and the
members of the Board shall be appointed by the president on a part time basis.47
The rationale for the spread of membership across the six geo political zones,
is in line with the Federal Character Principle under the Nigerian Constitution.48
However, this provision of our Legislation has been criticised for its tendency to
replace loyalty with national tribal loyalty49and incompetency where such qualified
persons are not within a particular geo political zones. Section 4 of the Act provides
that notwithstanding the provisions of section 3, a member shall cease to be a member
where he resigns, becomes of unsound mind, bankrupt, convicted of a felony or
offence related to dishonesty or corruption, incapacitation of the body or mind, or
upon satisfaction by the President that it is not in the interest of the Public or the
commission for such a person to hold such office.
39 The National Lotteries Commissions Act 2005 N0. 7 2005, became effective on that day.
40 Section 32 of the NLC Act 2005
41 Section 1(1) NLC Act 2005
42 Section 1(2) NLC Act 2005
43 Section 2(1) NLC Act 2005
44 Section 2(2) (c) NLC Act 2005
45 Section 2(2) (a) NLC Act 2005
46 Section 2(2) (d) NLC Act 2005
47 Section 2(3) NLC Act 2005
48 Section 14(3) of the Constitution of the Federal Republic of Nigeria 1999.
49 Akande J.O., Introduction to the 1999 Nigerian Constitution. (Lagos: MIJ Publishers), P. 55
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a. Powers of The Board
Section 6 of the Act, vest the power on the Board to make general policy
guideline, manage and superintend the policies of the Commission, determine the
terms and conditions of service of the employees of the Commission, fix
remunerations and benefit for staff and employee of the Commission in consultations
with the National Salaries, Income and Wages Commission and to do all that is
necessary within its opinion to ensure the efficient performance of the functions of the
Commissions.50
b. Functions of The Commission
Section 7 of the Act places an enormous duty on the Commission boarding on
monitoring and regulating, administrative, Evaluative, and a duty of Trust to the
Players, Stakeholders and the Public.
Theses duties includes:
A. To regulate the operation and business of the National Lottery in Nigeria;51
B. To collaborate with Licensee of the Gambling Industry, to set standards,
guidelines and rules for the operation of National Lottery in Nigeria;52
C. To promote transparency, propriety and integrity in the operation of National
Lottery in Nigeria;53
D. To ensure the protection of the interests of Players, Stakeholders and the
Public in the National Lottery;54
E. To carryout periodic assessment of the operation of National Lottery in
Nigeria and submit Report to the President and the National Assembly;55 and
F. To perform such other duties as may be directed by the President, from time to
time, and as are necessary or expedient to ensure the efficient performance of
the functions of the Commission under this Act.56
c. Lottery Licence
Sections 17 of the Act provides:
50 Section 6 of the Act.
51 Section 7(a) of the Act.
52 Section 7 (b) of the Act.
53 Section 7 (c) of the Act.
54 Section 7 (d) of the Act.
55 Section 7 (e) of the Act.
56 Section 7 (f) of the Act.
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As from the commencement of this Act, the operation of the business
of a National Lottery or any lottery, by whatever name called, shall be
subject to a licence granted by the President upon recommendation by
the Commission and compliance with the provisions of this Act or any
regulations made pursuant thereto.57
Section 17 of the Act clearly places all issues concerning the grant of permit
and or licence to operate a National Lottery within the jurisdiction of the Act. The Act
provides that licence may be granted to an individual or a Corporate Personality upon
application to the President through the Commission58 and such grant or licence
issued upon the fulfilment of all the conditions as prescribe by the Act.59 Licensee
with approval of the Commission may contract, appoint and or engage any person or
corporate body as an operator or agent to manage, promote, contract or operate, on
behalf of the licensee.60
d. Duration and Revocation of License
Licences issued under the Act is valid for a period of 10 years minimum and
15 years maximum, renewable upon application, by the President for a period not
exceeding 10years.61 Such a License may be revoke in line with Section 21 of the Act,
where the licences is no longer fit and proper to carry on the business of a National
Lottery whether arising from Insolvency, Liquidation or any other valid reason,
breach of any stated conditions of the licence, where such Licensee is not fit to benefit
from such licence as a result of Insolvency, Liquidation, confinement in Correctional
Services62 or any other institution or where he fails to take adequate steps to prevent
the commission of fraud by his employees after being alerted or becoming aware of
such act of fraud or dishonesty, unlawful prevention by the licensee or employee of
the President or the Commissions from carrying on its duties under the Act, where
57 Section 17 of the Act.
58 Section 18 of the Act.
59 Section 19 of the Act Prescribed conditions to be fulfilled before the grant of the licence and that
also to be fulfil after the said grant has been issued in other to maintain the said licence Section 22 of
the Act dealing with miscellaneous provisions relating to a licensee, prohibits any political office
holder with the meaning of the Constitution of the Federal Republic of Nigeria, from having any
financial interest in a National Licence or licence
60 Section 23 of the Act.
61 Section 20 (1) (2) of the Act.
62 The Nigeria Correctional Services Act 2019, Repeal The Nigeria Prisons Act Cap. P. 29 Laws of the
Federation of Nigeria and same provides for the change of name from the Nigeria Prisons to Nigerian
Correctional Services.
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licensee fails to abate or prevent the violations of the provisions of the Act, where the
licensee or any of its employees repeatedly and knowingly sell tickets or awards or
pays prizes to any person contrary to the provisions of the Act.63 Compensation may
be paid to the licensee after due valuation of all physical assets of the licensee that are
related or use in the conducting of the business of the National Lottery.64
e. Offences and Penalties Under the Act
Sections 30 and 34 of the Act contain a wide range of offences and their
penalties. These includes the offences of obtaining or attempt to obtain by forming or
conducting a syndicate for the purchase of a ticket or electronic entry,65 any form of
promotion of a syndicate for the purchase of an electronic ticket,66 Forgery of Lottery
ticket,67 sales or attempt to sell a forged ticket,68 Alteration of Lottery ticket with
intent to defraud,69 taking or conversions of proceed of a Lottery operated by a
Licensee,70 Sells of ticket to persons under Eighteen years,71Fraudulent Representation
as agent or licensee,72 giving of guarantee as incentive inducing a player as to winning
a prize or share from a prize in a Lottery,73 conducts or promotes a scheme which
gives guarantee that a player or bettor will win a prize or share out of a prize in a
lottery.74
The National Lottery Commissions Act also prescribes various penalties for
different offences. These are usually in form of terms of imprisonment or options of
fine, or both imprisonment and fine.75 The Act is of the effect that where no specific
penalty is prescribe for a specific offence, such offender upon conviction will be
liable to fine not less than Twenty Thousand Naira or imprisonment for a term no less
than one year or both such fine and imprisonment.76 Where such offence is committed
by a Corporate body, such corporate body shall be liable to fine of not less than One
Hundred Thousand Naira in addition to a fine of Twenty Thousand Naira for each of
63 Section 21 (A-G)
64 Section 21 (4)
65 Section 30 (1)
66 Section 30 (2)
67 Section 34 (1) (A)
68 Section 34 (1)(B)
69 Section 34(1) (C)
70 Section 34(1) (D)
71 Section 34 (1) (E)
72 Section 34 (1) (F)
73 Section 34 (1) (G)
74 Section 34 (1) (H)
75 Section 30 (3)
76 Section 34 (1) (I)
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the Director, Managers and Officers of the Company or an imprisonment for a term of
not less than one year or both.77
The Act empowers the National Lotteries Commission to properly carry out its
objectives as stated in the Act and to change the negative perception on lottery as
revenue generated therefrom is applied to good cause under the management of the
National Lotteries Trust Fund established under the Act to manage income generated
from Lotteries.78
2 The Lagos State Lottery Boards Law 2008
The LSLB Law was passed into Law on the 21st July, 2008.79 The Law is the
most comprehensively drafted legislation currently to provide for Gambling in Lagos
State. Before the enactment of the Law, the Lagos State Lotteries Board adopted a
single operator model, where a single licensee has the sole right to conduct lotteries
within the state. And this approach brought about illegal operation of Lottery Houses
therefore leading to the enactment of the Lagos States Lotteries (Amendment) Law
2008.80 The amendment of the Law in 2008 brought about multi-operators ‘model in
the Gambling Industry in Lagos State. The amended Law brought about a removal in
the exclusivity clause on the operation of Lottery within the State, Introduction of
Public Online Lottery Licence to Licence multiple Licensee, the Act also reduced the
duration of Lottery License, outlawing or prohibiting of Coupon /Paper Lottery,
Introduction of Online Lottery operation and also the enlargement of the jurisdiction
of the Board to regulate all aspects and types of Lotteries and Gaming.81
The Law is divided into 63 Sections, the Lagos State Lotteries Board
(amendment) Law, establishes the Lagos State Lottery Board,.82 Which is a body
corporate with perpetual succession and a common seal.83 The membership of the
Board cut across the various Stake holders of the industry, it includes a Chairman
with a knowledge and experience in the functions of the Board,84 a Permanent
77 Section 34 (2)
78 Section 35 National Lotteries Commissions Act 2005
79 Section 63 Lagos state Lotteries (amendment) Law 2008
80 Online sport betting, Lagos State Lottery Board. <https://lslb.ig.gov.ng./osb/ > . Accessed on 29th
April 29, 2018
81 Ibid
82 Section 1 (1) Lagos State Lotteries Board Law 2008
83 Section 1 (2) LSLB Laws
84 Section 2(1)(A)
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Secretary from the Ministry of Finance or his representatives,85Permanent Secretary
from the Ministry of Homes Affairs and Culture or his representative,86 a Legal
Practitioner of not less than 10 Years post-call experience,87 an Accountant of not less
than 10 years post registration experience,88 and four members of the public with
proven business experience in the functions of the Board.89
Members of the Board are appointed by the Governor on the recommendations
of the Commissioner,90 while the Legal Practitioner shall be appointed by the
governor on the recommendation of the Attorney-General for the State,91 the members
of the Board shall hold office for a duration of 5 years subject to a reappointment by
the Governor for another term.92
Section 2(5) of the Law states the conditions for the removal and or suspension of
members of the Board on the ground of misconduct or prolonged inability to perform
the functions as members of the board,93shall suspend where a member of the board is
facing a criminal proceeding on ground of fraud, forgery, uttering a document, perjury
or any offence involving dishonesty and shall be terminated where found guilty on
these.94
The Law provides that where a person or his immediate family or business
associates has any financial interest directly or indirectly, he shall not be appointed as
a member and no business of his shall be in conflict with his duties as member of the
Board.95Political Office Holder, Insolvent Persons, person removed from any office
on account of misconduct or persons who has been convicted for fraud, forgery, or
uttering of a document, perjury, or any offence involving dishonesty shall not be
appointed to the Board.96
85 Section 2(1)(B)
86 Section 2 (1) (a)
87 Section 2 (1)(d)
88 Section 2 (1)(e)
89 Section 2(1) (f)
90 Section 2 (2)
91 Section 2(3)
92 Section 2 (4)
93 Section 2 (5)(a)
94 Section 2 (5) (b) (c)
95 Section 7 (a) (b)
96 Section 7 (c)
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i. Duties of the Board
Section 9 of the Law the Lagos States Lottery Board is charged with enormous
functions of;
a. Advising the Governor on the issuing of License to conduct to conduct Lottery
in Lagos State.97
b. Ensure that Lottery within the State is conducted with all due propriety and
strictly in accordance with the Constitution, this Law, all other laws that are
applicable and the License for the Lottery and with any agreement pertaining
to the License.98
c. Ensure that the interest of every participant in the Lagos State Lottery is
adequately protected and the net proceeds are as large as possible.99
d. The board administers the fund and holds in trust and administer same in
accordance with the Law.100
e. Advice the Commissioner on the efficacy of a legislation as it relates to
Lottery.101
f. Make such arrangement within the Law to protect prize monies and the
distributions of the monies.102
g. Advice the Commissioner on all aspect relating to Lagos State Lottery and on
other matters as the Commissioner may requires.103
h. Ensuring that the promotion of Good Cause as envisage in the Law is
promoted with the incomes generated from Lottery.104
i. Inspect and audit the Licensee’s records of account whenever it appears
necessary in the opinion of the Board.105
97 Section 9 (a)
98 Section 9 (b)
99 Section 9 (B)(ii)(iii)
100 Section 9(c)(e)
101 Section 9 (d)
102 Section 9 (g)
103 Section 9(h)
104 Section 9 (i)
105 Section 9 (j)
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j. Grant License for Public On-line Lotteries and other Lotteries within the
States.106
k. Regulates and control every aspect of Lotteries operation in the State. 107
l. Monitor retail ticket sale by using information technology, standard based
solutions, comprehensive and automated processing.108
m. Impose fee on all Lottery’s operations within the State. 109
n. To enter into contract with any agent, supplier or platform operator for the
exercise of its monitoring, retail management and regulatory functions of the
Board.110
ii. Lottery Licence
The Governor issues License to conduct Lottery’s within the State after
consultations with the Commissioner or the Board.111 Such applications must be in
writing and must meet all conditions stipulated by the Law before such applications
can be considered.112 Such as sufficient and appropriate knowledge or experience to
conduct such Lottery,113possession of the necessary financial resources.114 Absence of
any political connections of such applicant,115such applicant must show a clear and
continuous commitment to Lottery operations within the State.116 The Law abolished
the use of Coupon or any means of Lottery unless such means is conducted online by
a Licensed Operator or their retailers.117
Under the Lagos State Lotteries Law, the Board regulates the following categories of
Lotteries within the State. These Lotteries License are namely:
1. Public Online Lottery,
2. Online Sport Betting,
3. Promotional Competitions,
106 section 9(k)
107 Sections 9 (L)
108 Section 9 (m)
109 Section 9 (n)
110 Section 9 (o)
111 Section 12 (1)
112 Section 12 (2)
113 Section 14(1)(i)
114 Section 14 (1) (ii)
115 Section 14 (1)(iii)
116 Section 14 (1)(iv)
117 Section 13 of the Law
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4. Private Lotteries,
5. Charitable Lotteries,
6. Society Competition,
7. Scratch Cards, and
8. Interactive Game.
9. Emerging Online Games (Web-Based, SMS-Based)
The Lagos State Lotteries Board Law prohibits all forms of conduct of
Lotteries unless through Online Channels, therefore online distributions channels such
as Internet, POS terminals and mobile technology are adopted. The use of these
Online Channels is aimed at achieving accountability in the Gaming industry,
promoting transparency as information is made accessible and verifiable at all time
and also for the purposes of assurance of Revenue for both the Players/Bettors and
also for the government to perform ‘Good Cause’118 within the State. Licence to
conduct Public Online Lottery in Lagos State, is obtained from the Lagos State
Lotteries Board as stipulated by the Law.
3 Money Laundering (Prohibition) Act 2011
The Money Laundering (Prohibition) Act 2011119 was passed in a bid to
prevent or stall money laundering in all sectors of the economy. The Gambling Sector
is not exempted as this sector could be a veritable means to Launder and legitimize
money back to the economy.
Money Laundering is a term used to describe the various methods or processes by
which funds derived from illegal or illegitimate sources, are brought into formal
economy through lawful financial channels with a view to legitimizing and
118 Section 48 of the Law defines ‘Good Cause’ to mean any cause as provided by the law, to which the
net proceeds generated are payable. These good causes are to meet the need of infrastructural
Objectives, Educational Objectives, Environmental Objectives, and all social and health related
objectives and other expenditure as may be approved by the Governor of the state. See section 33, 34,
35, 36, 37, 38 and 48 of the Lagos State Lotteries (Amendment) Law 2008.
These objectives are as contained in chapter 2 of the 1999 Constitution of the Federal Republic of
Nigeria (as amended) dealing with fundamental objectives and directives principles of State Policy.
Section 16 deals with Economic Objectives, Section 17 Social Objectives, Section 18 deals with
Educational Objectives, while section 20 deals with Environmental Objectives.
119 The Money Laundering Act 2011 repeal the Money Laundering Act, Cap M18 Laws of the
Federation 2004
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concealing or disguising the sources of such fund.120 The Money Laundering
(Prohibition) Act 2004 brings Casinos within the meaning of a Financial Institution,121
whereas the Money Laundering Act 2011, defines a Casino as Designated Non-
Financial Institution.122
Section 4 of the Act,123 places a duty to verify the identity of any Gambler who
buys, brings into exchanges chips or tokens, by requiring the gambler to present an
authentic document bearing his name and address.124 A record of the chronological
order of all transactions shall be kept stating the nature of the transaction, amount
involved together with the gamblers’ identity stating the surname, forenames and
address in a register to be issued by the Ministry of Commerce.125 Such a record shall
be kept at least Five (5) after the record of the Last transaction recorded.126 The Act
provides that compliance officer must be provided for at the management level of
such financial institution, regular training programmes for personnel and employees,
centralisation of information collected and establishment of an internal Audit unit to
ensure compliance with the provisions of the Act.127
The Act also provides for a written disclosure to the Commission that is
Economic and Financial Crimes Commissions by a financial institution or designated
Non-Financial institution of any single transaction, lodgment or transfer of fund in
excess of Five million Naira for and individual and Ten Million Naira for a body
corporate.128 Failure to comply with these provisions is an offence and upon
conviction is liable to a fine of not less than Two Hundred and Fifty Thousand Naira
and not less than One Million Naira for each day of continuous contravention of the
Act.129
120 M.L. Yusufari, Mohammed Isah, A.M. Bello, ‘Money Laundering in Nigeria: Implications on
National Development’ Being a conference paper presented at the 46 th Annual Conference of the
Nigeria Law Teachers Association, held at University of Ilorin, 22nd -26th April,2013. P. 73 -105See
also Section 14 Money Laundering (Prohibition) Act, 2011.
121 Section 25 of the Money Laundering(prohibition) 2004
122 Section 25 of the Money Laundering(prohibition) 2011
123 Section 4 MLA 2011
124 Section 4 (1) (a)
125 Section 4(1)(B) MLA 2011
126 Section 4 (2) MLA 2011
127 Section 9 MLA 2011
128 Section 10 (1) MLA 2011
129 Section 10 (3) MLA 2011
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4 Advance Fee Fraud and Other Fraud Related Offences Act 2006
The Act was passed into Law on the 5th June, 2006 to provide for fraud related
offences. The Act also regulates the Gambling Industry as its frame work to check
mate fraud related offences within the Industry. The Act in a bid to check these kinds
of fraud provides for the registration of all Internet Service Providers and Internet
Cafe with the Commission (Economic and Financial Crimes Commissions).130 A
register of all fixed and non-fixed line customers such as Global system of Mobile
Communication (GSM).131
The Act places a duty of care on the owners of the premises to ensure that her
premises are not use for the commission of any illegal purposes132any person who
ought to be registered, or furnish the Commission on demand on the use of his
services and facilities or facilitate access to data and information by employee or staff
of the Commission and fails do so with the intent to conceal or disguise the nature of
his activities or the use of his service or facilities commits an offence and upon
conviction to a term of imprisonment of three years without an option of fine and in
the case of a continuing offence, a fine of 50,000,00 each day such offence persist,
and where a person or entity is convicted under this act more than once shall have his
operational licence revoke or cancelled.133
With the advent of the Internet and subsequent emanation of online Gambling/
Lotteries, the importance of the Advance Fee Fraud Act cannot be over emphasized to
the Gambling industry.
5 Cybercrimes (Prohibition, Prevention Etc.) Act 2015
The Cybercrimes (Prohibition, Prevention, etc.) Act, 2015 is a very important
enactment regulating the Online Gaming, in Nigeria. The Act is enacted in Nigeria to
regulate the conduct of persons and activities in the Cyberspace in Nigeria. The Act
was passed into Law by the Nigerian National Assembly on the 5th of May, 2015.
The Act contains 59 sections, 8 Parts and Two Schedules. The Act criminalizes
Unlawful Access to a Computer,134and this protection relates to both private and
130 Section 13 Advance Fee Fraud Act 2006
131 Section 13 (2) Advance Fee Fraud Act 2006
132 Section 13 (3) Advance Fee Fraud Act 2006
133 Section 13(5)(6) Advance Fee Fraud Act 2006
134 Section 6
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individual interest within and outside Nigeria,135 the Act provides for registration of
cybercafé. And also, directed under Section 7(1) to maintain a register of users
through a sign-in register. The Register shall be available to Law Enforcement
Personnel whenever needed.136
Section 7(2) provides that any person who perpetuates Electronic Fraud or
Online Fraud using a cybercafé shall be guilty of an offence and shall be sentenced to
three years imprisonment or a fine of One Million Naira or both. Subsection 3
provides that if such person connives with the owners of the cybercafé, the owners
would be guilty of an offence and sentenced to three years imprisonment or fine of
One Million Naira. Section 8 criminalizes the use of any Computer System by any
person without lawful authority. Section 9 criminalizes the Act of destroying or
aborting electronic mails or processes which money or valuable information is being
conveyed. Section 12(1) criminalizes the Act of unlawful interception of non-public
transmissions of data.
Section 13 criminalizes the Act of computer related forgery which includes
knowingly accessing any computer or network with the intention that such inauthentic
data would be considered. The Act provides for computer related fraud. Section 14(4)
(a) of the Act provides that any person employed by or under the authority of any
bank or other financial institutions who with intent to defraud, directly or indirectly,
diverts electronic mails commits an offence and shall be liable on conviction to
imprisonment. Where such occurs, the Act provides for forfeiture of whatever benefit
derives from such act.
Section 16 of the Act criminalizes the act of unauthorized modification of
Computer Systems, network data and system interference. Section 21 imposes a duty
on any one operating a computer system to notify the National Computer Emergency
Response Team (CERT) of any attacks on intrusion on its computer. This is one of the
enforcement bodies created by the Act to enforce its provisions. Any person who fails
to report such incident shall be liable to pay a mandatory fine of N2, 000,000 (Two
Million Naira) to the National Cyber Security Fund.
Section 22 of the Act criminalizes identity theft and impersonation of any person who
is engaged in the services of any financial institution.
Section 28 of the Act criminalizes importation and fabrication of E-Tools such
tools include any device, including computer program or component designed or
135 Section 6(4)
136 Section 7
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adapted for the purpose of committing an offence under the Act. Section 29
criminalizes the Act of breach of confidence by service providers, where the
computer-based service provider with intent to defraud, illegally uses its customers
security code with the intent to gain any financial or material gain. Section 32 of the
Act criminalizes the offence of Phishing and spamming and also spread of computer
virus. Phishing is defined under the Act as the criminal and fraudulent process of
attempting to acquire sensitive information such as usernames and password.
VI. Other Legislations Dealing With Gambling/Online Gambling in Nigeria
The Criminal Code and Penal Codes are both Legislations that criminalises
Gambling when done outside the ambit of the Law.137 Such a Lottery must be
conducted by a Race Club in Nigeria and licence must be given by the Minister.138
Where Betting or Lottery is done to raise funds in aid of any Institution of a public
character after obtaining permission in writing from the Minister such exercise will
not be regarded as illegal.139 The Casino Taxation Act 1965140 the Act provides for the
payment of all net gaming revenue to the Federal Board of Inland Revenue. The Act
also empowers the Board to enter in the premises of such Gambling Company to
review the Statement of Account and also the income.
The Gaming Machines Act 1977, declares the owning and operating of any
Gaming Machines outside the provisions of the Law and without the necessary permit
as being illegal. The Act punish the act with a term of one (1) year of imprisonment
and the forfeiture of such machines to the Federal Government.
To obtain a Gambling Licence in Nigeria, the prospective gambling operator
must first incorporate a Company in Nigeria for that purpose, and such purpose of the
business must be approved by the Nigeria Investment Promotion Commission
(NIPC), Special Control Unit Against Money Laundering (SCUML), and the National
Office for Technological Acquisition and Promotion (NOTAP), a Capital Importation
licence where a foreign company, registration for a Valued Added Tax (VAT), and a
137 Section 239, Criminal Code Act Cap.C38, Laws of the federation of Nigeria 2004
138 Section 240, Criminal Code Act
139 Section 240D (2) Criminal Code Act
140 The Casino taxation Act 1965
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Tax Identification number as some of the requirements.141
VII. Observation and Findings
1. That the National Lottery Commissions Act did not make mention of Online
Gambling, the only mentioned was for the sales of ticket through Electronic
Channels which is permissible by the Act. The only comprehensive laws that
specifically made all provisions for Online Gambling is the Lagos State
Lotteries Board Law.
2. The various Laws, in its enactment uses and defined the word Lottery to mean
Gambling, however, the definitions provided by these Legislation covers all
aspect of Gambling and Lottery is a form of Gambling.
3. There is no Legislation prohibiting the operation of Gambling through the use
of the Internet and or Electronic Channels of both Local and Foreign based
sites and there are several Legislations protecting Online Transactions and E-
Commerce in Nigeria which encompasses all Gambling Transactions.
4. Nigeria is a permissible territory where Licensee who are carrying on a Land-
Based Gaming such as Casinos and other forms of Betting can expand its
operations Online, for the purposes of convenience, the only conditions
precedent is compliances with the provisions of the relevant Law and
guidelines regulating Gambling and other Online transactions in Nigeria.
VIII. Recommendations
Therefore, this work recommends the following:
1. The Legislatures must take on a holistic approach to the enactment or
amendment of the current legislative framework on Gambling to include
Online Gambling and all other forms in which gambling may occur in the
society.
2. The Acts provides for prohibitions for person under the age of 18 years from
gambling, but fails to exclude some certain person from Gambling, in South
Africa the law provides for application by an individual for exclusion from
gambling and this is referred to as self-exclusion such as over aged, mentally
141 ‘’Nigerian Gambling’ Gambling Africa. Accessed ,,, fromhttp://www.gamblingafrica.com/Nigeria/
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derail, and bankrupt individuals from gambling. Also, any person may apply
to the court requesting for the registration of a dependent, mentally ill person,
family members or any person under the care of the applicant whose behavior
manifest addictive or compulsive gambling and the court may grant such order
and the excluded person can also apply to the court to vacate such order where
it is no longer reasonable for such order to subsist. This approach is highly
recommended.
3. A trust fund or the scope of the current trust fund be expanded to administer
unlawful winning from illegal operators, prohibited persons or excluded
persons or proceeds of crime emanating from the sector be paid into, to
promote the pursuit of Good Cause.
4. The Issues of compliance and enforcement of the provisions of the law
requiring registration by cybercafé owner has proved difficult to actualized as
the Act need to provide for a specified enforcement authority.
5. A gambling specific Act such as the Unlawful Internet Gambling Enforcement
Act in the United States of America which places a duty on Internet Services
Provider to identify and prohibits restricted transactions pertaining to Online
Gambling, should be enacted separate from the Cybercrimes Act of 2015.
6. The various Legislations on Gambling should be amended to include problems
associated with gambling such as domestic violence, drugs abuse,
unmanageable debt or bankruptcy and other crimes should be incorporated in
the legal framework of Gambling in Nigeria to reduce the negative impact of
Gambling on the society.
7. The Licenses issued under the various legislation should be polarize to several
categories of licenses such as management and control of Gambling/Online
Gambling License, Gambling Equipment and Supply License, Internet, Server
or software License etc. this is to enable proper management and supervision,
ensure a level of standard and competence.
8. To prevent underage Gambling, the Licensee must ensure that gambles furnish
all necessary document such as identity document and the Licensee has a sole
responsibility to confirm same document and verify the age. This could be
achieved with collaborative efforts from the National Identity Card
Management or any other authority where such information could be accessed.
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IX. Conclusions
The rapid growth of the gaming industry is as a result of the influence and or
impact of technological advancement and such growth is difficult to halt, therefore,
regulations must be up to date at all times since prohibition will not guarantee the
cessation of Gambling/Online Gambling but rather promoting illegal operators.
Therefore, regulations provide an opportunity to manage the societal differences on
the right and wrong as it relates to this industry, bringing this industry and all its
competition and persons affected under the confines of the Law with the state
deriving socio-economic benefits. To achieve these, the current Legal frame work
must be critically looked into as they are grossly inadequate and in need of an
overhaul in other to properly position the Gambling sector in Nigeria.
296
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