NY Sweepstakes Casino Ban Only Needs Gov. Hochul's Signature
New York is on the brink of enacting legislation that would prohibit online sweepstakes casinos, following the passage of a bill that has cleared both chambers of the state legislature. The only remaining step for the bill to become law is the signature of Gov. Kathy Hochul. If signed, New York will become the fourth state this year to implement such a ban, joining Nevada, Montana, and Connecticut in targeting the increasingly scrutinized industry.
LISTEN TO THIS ARTICLE:Sen. Joseph Addabbo, who chairs the Senate Racing, Gaming, and Wagering Committee, sponsored the legislation, which passed through his committee and then the full Senate without notable resistance. The measure was substituted for an identical version introduced in the Assembly by Assemblyperson Carrie Woerner. The Assembly version advanced through multiple committees with minimal opposition before lawmakers agreed to take up Addabbo's bill for final approval.
Related: New York Senate Approves Bill to Ban Sweepstakes CasinosDuring the Assembly's consideration, Assemblyperson Jarrett Gandolfo was the only lawmaker who requested clarification on specific provisions. He sought an explanation regarding the dual currency system that underpins many sweepstakes-style platforms.
Woerner explained that such systems, which often allow players to purchase virtual currency that can potentially be redeemed for real cash through gameplay, differ significantly from traditional rewards programs. She noted that rewards systems like those used by Starbucks are not affected by the bill, as those do not allow point accumulation to be converted into actual money.
Opponents of the legislation have expressed concern about the broader implications of the bill, particularly on the gaming innovation landscape. A representative of the Social and Promotional Games Association warned that the bill could hinder investment and development in online gaming technologies.
They emphasized that many of today's successful and regulated platforms, including FanDuel, initially emerged in an environment that allowed experimentation. By prohibiting these unregulated models, critics argue that New York may stifle future breakthroughs in the sector.
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Increased Action Against Sweepstakes Casinos
Advocates for the bill have cited recent enforcement activity in other states as justification for tighter regulations. During Senate committee discussions, Sen. Addabbo pointed to actions taken in Connecticut, where the state's Department of Consumer Protection brought more than 1,000 criminal charges against High5Games for offering unlicensed sweepstakes gaming. He argued that New York should not wait for similar violations to occur within its own jurisdiction.
Further legal support for the measure came earlier this month when New York Attorney General Letitia James announced her office had issued cease-and-desist notices to 26 companies accused of marketing and selling sweepstakes-style coins to state residents.
One of the most prominent companies in the space, VGW, which operates brands such as Chumba Casino, Global Poker, and Luckyland Slots, reportedly began preparing to exit the New York market in anticipation of the bill's passage. The company is expected to phase out its operations in the state over the coming months as part of a strategic withdrawal.
While New York advances toward a prohibition on sweepstakes gaming, efforts to pass similar legislation have met resistance in other jurisdictions. In Louisiana, Gov. Jeff Landry vetoed a bill this week that had previously passed unanimously through both legislative chambers.
Meanwhile, a comparable proposal in Maryland stalled in committee and failed to gain traction. Despite these setbacks, New York's legislative momentum represents a significant shift in how states are approaching the regulation of online gaming models that operate outside traditional gambling frameworks.
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