Sweepstakes casino gaming in New York is under the spotlight as a Senate committee has voted unanimously to ban it.
The New York State Senate Racing, Gaming, and Wagering Committee approved SB5935. If it becomes law, this bill would ban online sweepstakes casino games in New York that let players use a special type of currency to win prizes or cash in games that resemble casino games.
The bill also targets other businesses, like banks and companies that help process payments or promote these games, preventing them from supporting the operation of such sweepstakes casino games in New York. Penalties under this legislation could range from $10,000 to $100,000.
This move is significant as the area of iGaming has faced criticism and scrutiny in recent months, with opponents arguing that these games operate in a legally grey area.
Understanding Sweepstakes Casino Gaming and Its Loopholes
Sweepstakes sites operate using a structure known as dual-currency gaming. These platforms offer virtual coins that players can later exchange for cash prizes.
Currently, this setup has allowed sweepstakes to operate without directly violating existing laws. Sweepstakes casinos exploit a loophole by adhering to the “no purchase necessary” rule, which is a legal hallmark of sweepstakes, not lotteries.
Players buy valueless Gold Coins as play money, which automatically gives them valuable Sweepstakes Cash. It is this cash that players then use to gamble.
New Jersey Also Making the Legislative Push for Change
New Jersey's lawmakers have changed their approach to social casino sweepstakes. Initially, there was a bill (AB 5196) aimed at regulating these games by requiring them to get licenses, follow rules, and pay taxes. However, a new bill (AB 5447) has been introduced to ban them altogether.
Connecticut state regulators also recently took action against a sweepstakes casino.
So you can see, the proposed changes in New York's approach align with a broader concern across many states regarding the legality of online sweepstakes.
SPGA Denounces SB5935
What's Next for New York’s Sweepstakes Casino Bill?
In The Empire State, an accompanying bill (A6745) has been introduced in the Assembly by Carrie Woerner but has yet to advance further.
The proposed changes in New York's approach align with a broader concern across many states regarding the legality of online sweepstakes. While it's illegal to play real-money slots online in most states, sweepstakes casinos continue to find creative ways to navigate legal waters.
This legislative effort is a significant step towards regulating an arena of gaming that has long been criticized for exploiting legal loopholes. As this story develops, New York could potentially pave the way for even more states to reconsider their policies on online sweepstakes gaming, ensuring a more consistent legal landscape across the country.
So, you may want to get those bonus codes and free spins while you still can.
