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Financial Institutions...In the News

  • Debit card fees dispute between retailers and Federal Reserve will not be heard by Supreme Court.  (Central Maine 1.20.2015)
  • President Obama proposes new tax on big banks to discourage high risks.  (Maine News Simply 1.20.15)
  • Maine’s economic forecast is positive but must look to immigrants and urban areas to sustain future growth according to USM Economist Charlie Colgan.  (The Free Press 1.15.2015)
  • RealtyTrac, a real estate data firm, reports foreclosure rates dropped in 2014   (News Maine 1.15.2015)
  • Credit unions ask Congress for a Data Breach Working Group to help prevent data breaches.  (The Hill 1.15.2015)
  • Dividends from U.S. Banks remain low in 2015.  (The West Austrailian  1.13.2015)
  • The markets in the U.S. have improved to make U.S. the leading the global economy.  (PPH 1.13.2015)
  • A national gang, “Felony Lane Gang,” is stealing checks and personal information from cars parked in parking lots in Maine.  (BDN 1.14.2015)
  • New mortgage calculation tools launched by Consumer Financial Protection Bureau.  (MPBN 1.13.2015)

What You Need to Know About Sweepstakes and Contests

The following was originally posted on by Robert Laplaca, Chair of Verrill Dana's Promotions Law Group.


A sweepstakes is a chance promotion where the winners are selected randomly, such as random drawings, giveaways, and instant win games.

There must be no purchase necessary to enter a sweepstakes. Entries with a purchase are permitted, but there must also be a free alternative method of entry for everyone, which provides for equal limitations, equal quantity, equal time and equal prizes. Free entry methods include online and mail-in. But watch out for any hidden costs. For example, text messaging is not a “free” method of entry, because of the possible message and data rates that may apply.

For promotions with prizes over $5000 there are registration and bonding requirements in New York and Florida.


A contest is a promotion where the winners are selected based upon a skill, such as essay, video, recipe, or singing contests.

A sponsor may require a purchase or fee for entry, except in a few states, but the key is that a true skill contest must be based upon an actual, definable skill and there must be distinct judging criteria to select the winners.

Official Rules

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What You Need to Know About Commercial Co-Ventures

The following was originally posted on by Robert Laplaca, Chair of Verrill Dana's Promotions Law Group.

Commercial co-ventures are a form of cause-related marketing that have proliferated in recent years. Commercial co-ventures between a company and a charity not only help charitable causes, but also tend to increase a company’s bottom line. Indeed, market studies have shown that most people will opt to purchase a product associated with a charitable cause over a competitor’s product. Commercial co-ventures are highly regulated, so carefully planning and must be taken to avoid any legal pitfalls.

What is a commercial co-venture?

Generally, a commercial co-venture is a charitable sales campaign where a brand advertises to the consumer that the brand will donate a portion of the purchase price to charity.

How is it regulated?

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Maine Governor LePage Unveils Dramatic Tax Plan

On January 9, 2014, Maine’s Republican Governor Paul LePage released his Biennial Budget for the State of Maine for fiscal years 2016 and 2017. The Budget proposes sweeping changes to Maine’s tax code and would dramatically alter they way local government is funded. One of the most dramatic changes in the Budget is the proposal to reduce Maine’s income tax rate from 7.95% to 5.75%, which will result in a $1.2 billion cut in individual income taxes over the FY 2018-2019 biennium. The Budget also maintains personal exemptions with the federal deductions, but repeals itemized deductions and certain credits, including the charitable deductions and the Earned Income Tax Credit. To help seniors, the Budget eliminates the income tax on pensions, and expands the homestead tax exemption for retirees.

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Maine Crowdfunding - Is Your Business a Good Candidate?

The following was authored by Gregory Fryer and Elizabeth Riotte and was originally distributed by Verrill Dana's Securities Law Group as a client alert.

The Maine Office of Securities has published a Maine crowdfunding rule that goes into effect on January 1, 2015. New Rule 523 – entitled “Rule Regarding Short-Form Seed Capital Registrations”1 – can be found at MOOS’s home page: The rule allows a Maine-based company to seek up to $1,000,000/year of new capital through a broadly disseminated offering – such as through Internet social media sites, Internet advertising, a securities broker-dealer, or the company’s own website. The rule is somewhat fussy, and in each case requires that a registration statement be filed and cleared by MOOS before any solicitations begin. The short-form registration statement is built around a company business plan and a detailed set of financial statements, supplemented with a Q&A format disclosure document covering a range of topics. Securities can be sold under this registration only to Maine residents, and there is a $5,000/year cap on the amount any one person can invest (unless the person has sufficient wealth or income to be an “accredited investor,” as defined). All subscription proceeds must be impounded with a bank until a company-specified minimum dollar amount has been raised. The company must also specify a maximum dollar amount to be raised (not exceeding 3.33 times the minimum).

Who is a good candidate for using the new Maine crowdfunding rule? We will know better as people gain experience with this, but in our judgment the following factors will be important:

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