A contest designed to raise money for homeless veterans in Western New York has run afoul of New York State gambling regulations.
Hero House Giveaway 2014 sold $100 tickets for a raffle that included prizes such as a custom-built, three-bedroom home valued at $250,000; a 2014 Ford Fusion; and a $5,000 vacation.
But the promotion, which was to benefit Western New York Veterans Housing Coalition, Vietnam Veterans of America and Vets H.E.R.D Inc., has been called off by its organizer.
The New York State Gaming Commission’s Division of Charitable Gaming found the promotion violated several rules governing games of chance:
• Real estate raffles are prohibited in New York State.
• Prizes must not exceed $100,000 in value, and raffle tickets cannot be sold over the Internet, purchased with credit cards or PayPal.
• Raffle tickets are also limited to specific geographic areas, and ticket sales must be approved by a municipal clerk wherever they are sold.
The Better Business Bureau of Upstate New York contacted the gambling commission after receiving inquiries about the promotion.
“This is a 15-year dream of mine that’s going up in smoke,” said Michael Eggers, the organizer. “It’s something I’ve always wanted to do to give back to the community and veterans.”
Eggers said he contacted the state specifically to ask about the $100,000 prize threshold and was told that he would be fine as long as he kept good records for the Internal Revenue Service.
Since learning of the violations, he has also spent time working with the state trying to modify the contest in order to keep it running, but to no avail, he said.
By all accounts, Eggers was a good Samaritan who simply “didn’t have his i’s dotted and his t’s crossed,” said Peggy Penders, a spokeswoman for the Better Business Bureau.
There are no allegations that Eggers was scamming ticket holders or the charities involved, and no one had doubted that he intended to deliver the prizes to contest winners.
“I feel bad about how it ended up. He was never out to hurt anybody; he wanted to do something good,” said Celia O’Brien, chief operating officer of WNY Veterans Housing Coalition. “A lot of money came out of his own pocket setting it up.”
A builder by trade, Eggers has worked with veterans groups for nearly 10 years, donating materials and time toward rehabbing veterans’ homes, completing repairs and projects such as building wheelchair ramps for disabled veterans.
Eggers said he did his best to follow state laws regarding the contest since he started promoting it in May.
The contest got a lot of high-profile media coverage, attracted several sponsors and ran $30,000 worth of advertising in radio and television.
“Not even an idiot would have started this if they knew they couldn’t finish it,” Eggers said. “You try to do something nice, and it blows up in your face.”
In the end, it might not have mattered. Eggers had been deciding whether to end the promotion anyway because of slow ticket sales. Of the 3,400 tickets he needed to sell to finance the project, he had sold fewer than 200. He had hoped to sell a total of 7,500 tickets, which would have netted the veterans charities $400,000.
Eggers said he hopes to mail refunds to ticket holders within 30 days, along with a letter of apology. Those with questions can contact him at 812-2226.