A bill proposing to ban sweepstakes casinos in New York has been amended to give regulators more control over what constitutes a dual-currency system.
Sen. Joseph Addabbo’s SB5935 aims to prohibit social and sweepstakes casinos in the Big Apple. 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”.
An amendment now gives the New York State Gaming Commission control over what is defined as a dual-currency system. This allows the regulator greater control to ban sites that the bill is targeting.
If the bill is passed, operators that violate the rules face fines ranging from $10,000 to $100,000.
SPGA criticize the amendment
The Social and Promotional Gaming Association (SPGA) said the amendment shows that the bill is flawed. A spokesperson for the organization that includes prominent sweepstakes casinos such as High 5 Entertainment, stated,
“This amendment is a clear acknowledgment that this anti-business bill needlessly threatens New York’s economy. But this amendment doesn’t fix anything.
“Lawmakers wouldn’t be amending the bill if it didn’t need amending. New York legislators are publicly admitting the bill was flawed, and other states like Louisiana should take note before making the same mistake. This was already bad legislation. Lawmakers have taken a mess and made it into a catastrophe.”
The SPGA argue that the bill could have dire consequences for the state’s economy and restrict promotions run by companies such as McDonald’s and Starbucks.
A similar bill passed the Senate in Louisiana last week and made clear that this would not happen. Sen. Adam Bass commented, “Regardless of what you’ve heard, this bill does not affect legitimate promotions, such as McDonald’s Monopoly, Starbucks or Marriott rewards.
“This bill narrowly defines sweepstakes casinos. We know the gaming control board and attorney general have no interest in going after Starbucks or Marriott or McDonald’s and are solely focused on putting an end to sweepstakes casinos in this state.”
Sweepstakes operators exiting New York
With the bill progressing, many platforms, including High 5 Games and PlayFame, withdrew from New York last month. In a message to customers, PlayFame wrote, “This was a difficult decision for us to make, and we understand that this may be disappointing news. We want to take the opportunity to thank you for your support and your loyalty to our PlayFame community.”
New York is the biggest gambling market in the US and posted record numbers in betting figures last year, more than any other state in US history. New York online casinos remain unregulated, however, and sites such as sweepstakes casinos generated an estimated $4.3 billion in revenue last year.
Stricter regulations aim to curb that industry, which does not contribute to state taxes. The state has the highest tax rate in the US for gambling, at 51%, and collected over $2.9 billion in tax revenue from gambling in 2024.
The amended bill has until the end of the legislative session on June 12th to be ratified.
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.
