Online sweepstakes casinos and sportsbooks have officially sparked the ire of lawmakers and regulators in yet another state: New York.
Senate Bill 5935 was introduced by New York Sen. Joseph Addabbo Jr. on Tuesday and referred to the chamber's racing, gaming, and wagering committee, which Addabbo chairs.
The legislation seeks to prohibit the operation, support, and advertising of sweepstakes casinos in New York. It also gives the state gaming commission and attorney general's office ways to go after violators.
That's enough of that
The bill defines online sweepstakes games as something that uses a "dual-currency system of payment," which lets a player exchange that currency for prizes and real money.
While a sweepstakes game would not include those that do not award cash prizes or cash equivalents, the definition also mentions products that simulate “casino-style gaming,” which means slots, table games, and online sports betting.
If the bill becomes law, anyone offering, providing support services to, or helping to promote such games in New York would be subject to fines of $10,000 to $100,000 for each violation. They could face the loss of their gaming license or eligibility for a gaming license in the state as well.
The state gaming commission, police, and attorney general's office would be able to enforce the law, and the commission could conduct investigations and issue cease-and-desist letters, among other things.
“Online real money ‘sweepstakes casinos’ have recently become widely available in New York over the internet on mobile devices and personal computers, including to minors,” Addabbo’s sponsor memo says. “These products evade consumer protection, responsible gaming, and anti-money laundering requirements to which gambling in New York is otherwise subject. These products and operations are untaxed and unregulated. They present unfair competition to the state's legal, highly regulated and economically important casinos.”
Sweeping up the gaming market
The introduction of Addabbo’s bill follows similar measures that have been proposed in other states, such as Florida and Mississippi. It also highlights the growing concern lawmakers and regulators have with online sweepstakes casinos and sportsbooks, as well as their increasing willingness to do something about it.
New York State Gaming Commission Chairman Brian O'Dwyer mentioned sweepstakes during a meeting in January, saying he has "serious concerns" operators are violating New York's gambling laws.
“I have discussed this with our staff,” O’Dwyer said. “They have made several referrals to law enforcement, and they are assisted in case development. I can assure my fellow commissioners and the public that if … this activity continues and is found to be in violation of New York state's gaming law, that we will do everything possible to assure that that law is protected and respected.”
The other side
The Social and Promotional Games Association (SPGA) was quick to come to the defense of its members following introduction of Addabbo's bill.
The pro-sweeps group said in a statement that it "unconditionally opposes" the proposed legislation.
However, the SPGA did thank New York lawmakers for what the group called "formal recognition" that social sweepstakes are legal, adding "you don't need to outlaw something if it is already illegal."
"But that's where our appreciation ends," the SPGA said. "Albany legislators have no business dictating to New Yorkers what games they can play on their phones. This deeply flawed legislation is an affront to personal freedoms, an insult to New York voters, and a colossal waste of government resources."
