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As several U.S. states are rapidly coming to the conclusion of their 2025 legislative sessions, time is of the essence to pass legislation to prohibit online sweepstakes casinos, with bills still on the agenda in New York, Louisiana and Connecticut.
If Senate Bill 5935A is passed by the New York legislature, the Empire State would become the largest U.S. jurisdiction to ban online sweepstakes sites.
On Thursday (May 29), the bill was still waiting for a Senate floor vote, having cleared a Senate committee in early March.
As introduced by Senator Joseph Addabbo, a Democrat, the bill originally defined online sweepstakes as a platform that “utilizes a dual-currency system of payment allowing the player to exchange the currency for any cash price, cash award or cash equivalents, and simulates casino-style gaming”.
The bill was amended on April 30 to give the New York State Gaming Commission (NYSGC) control over what is defined as a dual-currency system.
If S 5935A is passed, operators that violate the ban face fines ranging from $10,000 to $100,000.
Addabbo’s bill would target other individuals and entities associated with the online platforms, including employees, investors, financial institutions and payment processors.
An identical Assembly version of the bill, A 6745A, was referred out of the Codes Committee on Wednesday and is now before the Assembly Ways and Means Committee.
Proponents of the legislation are starting to run out of time, however, as the New York legislature is scheduled to adjourn on June 12.
States Crack Down On Sweepstakes
New York is not the only state still considering legislation to prohibit online sweepstakes casinos and sportsbooks.
A Louisiana bill banning online sweepstakes was placed on the calendar for a final vote Thursday (May 29) in the state's House of Representatives, after it was approved by the Senate in late April.
But lawmakers adjourned without taking up the measure.
Republican House Speaker Phillip DeVillier said the chamber was expected to resume final readings of Senate bills when members reconvene on Monday (June 2).
The Louisiana House Committee on Administration of Criminal Justice unanimously approved Senate Bill 181 last week. The full House now has to pass the bill, authored by Republican Senator Adam Bass, before the Louisiana legislature adjourns on June 12.
Bass' bill proposes to prohibit the dual-currency model utilized by many sweepstakes operators, deeming it illegal gambling rather than a legal sweepstakes operation. The ban would apply to sweepstakes that replicate casino-style games, lottery games and sports wagering.
If approved, the Louisiana Gaming Control Board would be able to bring civil enforcement actions and impose civil penalties on companies engaging in the illegal form of sweepstakes gaming. The control board would also be able to levy fines from $10,000 to $100,000 per incident.
As his bill has made its way through the legislative process, Bass has reiterated his position that the legislation was about forcing “these illegal operators … out of our state”.
Connecticut lawmakers are also in a position to prohibit sweepstakes platforms, but now have less than a week left to move a bill through the state's House of Representatives before the legislature adjourns its 2025 session on June 4.
The Connecticut Senate approved Senate Bill 1235 by a 36-0 vote last week, moving the wide-ranging gaming bill to the House for further consideration. On Wednesday, SB 1235 was listed on the House calendar but had yet to be assigned to a House committee.
Introduced by the General Laws Committee on behalf of Connecticut's Department of Consumer Protection, the bill would expressly prohibit any sweepstakes contest that “allows or facilitates participation in any real or simulated online casino gaming or sports betting”, without a state license.
VGW Escapes From New York
States with pending legislation to prohibit sweepstakes are not waiting for bills to pass before taking enforcement actions over the issue.
The Connecticut DCP on Thursday announced a $1.5m settlement with High5Casino operator High5Games, enabling the company to keep its state license as an online casino supplier despite previously offering an unregulated sweepstakes platform to Connecticut residents.
In another significant development, leading sweepstakes VGW Holdings Ltd has also confirmed that it will be withdrawing its online sweepstakes sites from New York this summer.
VGW, which operates social sweepstakes brands Chumba Casino and Luckyland Slots, said it would begin the process to withdraw its dual-currency sweepstakes games from New York on Monday.
"We can confirm that following careful consideration, we’ve informed players of a decision to phase out Promotional Play (sweepstakes promotions) in the state of New York,” a VGW spokesperson said in an email.
Beginning Monday, customers will no longer be able to acquire sweepstakes coins through any method and will only have a month to play through any remaining sweepstakes coins before they are frozen on July 2.
Additionally, mail-in requests for sweeps coins will no longer be processed from July 2, but customers will still be able to lodge redemption requests.
As of August 1, players will no longer be able to redeem any sweeps coins won for prizes in New York, although free-play games will remain available.
No reason was given for the company's decision, although it follows recent public comments from the chair of the New York State Gaming Commission that sweepstakes platforms may be violating current gambling laws.
“We understand this is an adjustment after many years and some players may be disappointed,” said the VGW spokesperson. “This decision wasn’t taken lightly and was made at this time in the best interests of all our stakeholders.”
VGW joins High5Casino and PlayFame as operators to leave New York State.
In addition to New York, VGW does not offer dual-currency sweepstakes games in seven other states due to state laws or regulations. The company has withdrawn from Connecticut, Delaware, Michigan and Nevada within the past 18 months.
VGW's exit from New York came a few days after it announced the formation of the Social Gaming Leadership Alliance (SGLA) to advocate for appropriate state regulation of the industry.
Former U.S. Congressman Jeff Duncan, a Republican from South Carolina, will lead the coalition. The coalition also includes PlayStudios, the parent company of sweepstakes platforms McLuck and Pulsz, as well as Canadian payment processor Nuvei.
In September, ten social gaming and sweepstakes operators formed the Social and Promotional Gaming Association (SPGA). The SPGA includes High 5 Entertainment, but VGW did not join the association.
