Details have emerged of a bill in California that has been amended to include a prohibition of sweepstakes casinos, and the bill also targets operators that allow sports betting.
Rumors circulated online that a bill had been amended in California targeting sweepstakes casinos last week. Howard Glaser, Global Head of Government Affairs at Light & Wonder, posted on LinkedIn that lawmakers had introduced a bill looking to ban the platforms.
However, no official details had been released by the California legislature. That has changed, however, and the details of the amendment to bill AB831 by Assemblyman Avelino Valencia have now emerged.
The bill makes operating casino-style games through sweepstakes a misdemeanor, punishable by up to $25,000 in fines and 1 year in county jail. In addition, it also targets sites that actively promote or support the platforms, which include payment processors, geolocation services, platform providers, gaming content suppliers, and affiliate marketers.
Amendment Backed By Tribal Leaders
The addition of the ban on sweepstakes casinos comes in an amendment to a bill that revises tribal-state gaming compacts. Tribes have been vocal in their disapproval of platforms that are infringing on the exclusive rights they have to gambling in California.
Victor Rocha, the Conference Chair of the Indian Gaming Association (IGA), commented on sweepstakes casinos: “They’re unregulated. They’re untaxed. This is gambling on training wheels. It’s a bunch of lawyers who are spitting in our face and looking at gray areas thinking that we’re not going to act.”
The chairman also pointed out that “these guys don’t pay money into the system. When we’re talking about cannibalization, this is what we’re talking about. It’s companies like this that take money out of California.”
The California Nations Indian Gaming Association (CNIGA) has reportedly backed the bill and the organization’s chair is set to provide more details along with Rocha in a webinar on Wednesday. Rocha posted on X that, “A new bill in California targets the illegal sweepstakes gambling industry. Jason Giles and I will break it down with CNIGA’s James Siva on Wednesday’s webinar.”
Celebrity Promoters Could Be Held Accountable
As the amendment targets promoters of sweepstakes, it has also been reported that celebrities who endorse the platforms could be held accountable. TV personality Ryan Seacrest already faces a lawsuit in California over his promotion of VGW, the company behind Chumba Casino, Luckyland Slots, and Global Poker.
Other sweepstakes companies have also faced legal scrutiny in the state. Stake received a temporary reprieve from a judge that sent a lawsuit to private arbitration earlier this month. A California resident, Dennis Boyle, had filed the lawsuit alleging that Stake’s sweepstakes model is already in violation of California gambling laws.
States Shutting Down Sweepstakes
If the new amendment is passed, then it could lead to stricter judgments in future court cases and the withdrawal of platforms from the Golden State. Several sweepstakes operators have been driven out of New York as the state is on the verge of passing legislation targeting the dual-currency model employed by operators. The bill awaits Governor approval after being passed in the Assembly and Senate.
Montana and Connecticut have already passed bans this year, while Louisiana lawmakers voted unanimously in favor of similar legislation, but Gov. Jeff Landry vetoed the bill citing the powers the state already had to shut down illegal gambling websites.
Bans in California and New York would be a big step to outlawing the platforms altogether. Following the amendment, the bill will go back for a second reading in the Assembly and would need to be passed in a full vote there before heading to the Senate and eventually to Governor Gavin Newsom for his sign off.
Adam is an experienced writer with years of experience in the gambling industry. He has worked as a content writer and editor for five years on sites such as Oddschecker, CoinTelegraph and Gambling Industry News, bringing excellent knowledge of the world of sports betting and online gambling. Adam focuses on emerging stories in the ever changing landscape of betting in the US. Read the latest on prediction markets, changing legislation, and sweepstakes.
