Regulating Sweepstakes Casinos: NJ, MS, MD, CT, NY

• Sweepstakes casinos offer a free alternative to real money online casinos, causing them to be a significant threat to the iGaming industry.
• New Jersey, Maryland, Connecticut, and New York have already begun introducing bills to regulate and prohibit sweepstakes casinos.

BALTIMORE – Sweepstakes casinos, the popular free alternative to real money online casinos, have become an increasingly prominent topic within many state legislatures. These types of casinos provide customers the chance to win virtual cash that can be converted to real money or prizes (Gold Coins, Sweepstakes Coins, etc.).

As of right now, sweepstakes casinos are legal in over 45 states because they are not subject to the same rules and regulations as real-money online casinos in the United States. Sweepstakes law makes it clear that chance games are legal as long as they have the feature of free entry, which makes them accessible in places where online gambling is unregulated.

The American Gaming Association made a statement regarding this method of legal betting that says, “The lack of regulatory oversight presents many risks for consumers as well as the integrity and economic benefits of the legal gambling market through investment and tax contributions. These sweepstakes-based operations have weak (if any) responsible gaming protocols and few, if any, self-exclusion processes.”

Sweepstakes Bills In Play

With sweepstakes casinos being a significant threat to the iGaming industry, six states are working toward banning sweepstakes gambling.

New Jersey’s Rep. Clinton Calabrese introduced Assembly Bill 5196 on January 16th of this year. This bill requires licensure, oversight, and taxation within the internet gaming framework and includes sweepstakes casinos in the definition of internet gaming.

Alongside this bill, Senator Joseph Cryan introduced its twin bill, SB 4109. But The Garden State didn’t stop there. On Monday, Assembly Bill 5447 was referred to the Assembly Consumer Affairs Committee. This bill prohibits the sweepstakes model of betting and allows the Division of Consumer Affairs and the Division of Gaming Enforcement to implement new penalties for unlawful gaming operations.

Senator Corderman of Maryland created Senate Bill 0860 and it was cross-filed with House Bill 1140. SB0860 “proposes the license denial and/or license revocation from any person or entity that supports or promotes the operation of online sweepstakes games.”

This bill has passed the Senate and is now moving on to the House.

The northern states are the biggest supporters of denying their residents the chance to play at sweepstakes casinos. Connecticut Senate Bill 1235 was introduced on February 7th and will ban sweepstakes casinos.

This bill will define and redefine certain terms concerning “gaming” and provides that certain people conducting sweepstakes or promotional drawings shall not facilitate participation in certain real or stimulated online casino gaming.

Senate Bill 5935 was brought to the committee by New York State Senator Joseph Addabbo Jr. With New York being the fifth state to propose a ban on sweepstakes casinos, SB5935 prohibits certain people from operating, conducting, or promoting certain online sweepstakes games or supporting the operation, conduct, or promotion of such games.

Penalties for violations of such rules include up to a $100K fine, loss of gaming license, and permanent ineligibility for a future gaming license.

The prohibiting of sweepstakes casinos will have a lasting impact on the iGaming industry. While the reasons behind the closing of these sites are constantly changing, fans of these casinos will have to adapt to the ongoing regulations as they continue to happen. Get ready, because this is just the start of the prohibition and or regulation era of sweepstakes casinos.

News tags: Baltimore | Casinos | Clinton Calabrese | Connecticut | CT SB 1235 | Joseph Addabbo Jr. | Maryland | MD SB 0860 | New Jersey | New York | NJ AB 5196 | NJ AB 5547 | NJ SB 4109 | NY SB 9535 | Paul Corderman | Sweepstakes | sweepstakes casinos