Virtual Gaming Worlds (VGW), operator of several sweepstake casino brands, announced it will stop accepting Michigan players amid a state crackdown on unlicensed gaming sites.
VGW’s players can use their existing balances through the end of the month. Players will have until Feb. 1, 2024, to claim any pending prizes.
“VGW continually evaluates their business operations in the interests of all their stakeholders and after careful consideration they have decided to take this course of action,” the company explained in a statement.
VGW’s exit from Michigan will make the third U.S. state where it is absent. The Australian-based company does not currently operate in Idaho or Washington.
Crackdown in the Gray Zone
So-called sweepstakes casinos use digital currencies, which have no direct cash value. In this way, the operators have attempted to stay under the radar of gambling regulators. Players, however, can, and do, spend real money to enhance their play. And sites award both cash and other prizes with a monetary value, such as gift cards.
"VGW continually evaluates their business operations in the interests of all their stakeholders and after careful consideration they have decided to take this course of action."
- Virtual Gaming Worlds in a statement
Unregulated gaming sites don’t pay state taxes like their regulated peers. Meanwhile, there is little legal recourse for players who have issues with an unregulated gaming site. So, sweepstake casino sites can pose more risks to consumers. As a result, some states are starting to crack down on operators.
In September, after a two-year investigation, Michigan Attorney General Dana Nessel secured an Assurance of Discontinuance from sweepstakes casino operator Golden Hearts Games. At that time, she made it clear that offshore and unregulated gaming sites were not welcome in the Great Lakes State.
“Unlicensed gaming robs our schools and our government of essential funding and leaves consumers unprotected," Nessel said in a Sept. 12 statement. “When companies like Golden Hearts attempt to circumvent Michigan’s gaming laws, they create the false impression that their games are legal and safe for consumers. My office is committed to ensuring that our gaming laws are strictly enforced, and those who violate those laws are held accountable.”
Sweepstakes casinos aren’t the only target of state regulators. Last month, the Michigan Gaming Control Board issued a decision to ban pick’em fantasy products. Florida, Ohio, and North Carolina have also weighed in against pick’em. Meanwhile, Maine recently fined one operator nearly $400,000 and ordered the company, Underdog Sports, to cease offering its pick’em product in the Pine Tree State.
