New York Senate Advances Bill to Prohibit Online Sweepstakes Gaming

New York progressed through the Senate Racing, Gaming, and Wagering Committee on Tuesday. The legislation, SB 5935, sponsored by Senator Joseph Addabbo, now moves to the full Senate for further consideration.

Legislative Committee Approves Bill Targeting Sweepstakes Gaming

During a brief committee session, the New York Senate Racing, Gaming, and Wagering Committee approved Addabbo’s proposal. The senator, a strong proponent of regulated online gambling, highlighted concerns over the rapid growth of unregulated sweepstakes casinos.

“These online sweepstakes casinos essentially mimic casino games but operate without regulation,” Addabbo stated. “Several states, including Connecticut, have already taken steps to outlaw them. We are looking to ensure similar protections in New York.”

The committee voted to advance the bill with two in favor and one member voting “aye without recommendation.” Senator James Tedisco expressed concerns about the potential influence of such platforms on younger individuals, stating, “A lot of kids have a lot of temptations; they don’t need another one.” Senator Pamela Helming acknowledged the bill’s intent but withheld full endorsement, citing unresolved concerns from her constituents.

Regulatory Actions and Legal Precedents

Addabbo’s argument for the ban referenced recent enforcement actions in Connecticut against High 5 Games. The Connecticut Department of Consumer Protection (D) Gaming Division recently revoked the company’s license and issued over 1,000 criminal charges against its brand, High 5 Casino.

D Commissioner Bryan T. Cafferelli stated, “High 5 Games took advantage of their credential to mislead consumers into believing they were participating in gaming on a legal platform when, in fact, they were breaking the law.” Connecticut law only allows online casino operations through DraftKings and FanDuel under agreements with tribal partners.

The bill defines sweepstakes games as online or mobile contests resembling casino, lottery, or sports betting games, particularly those utilizing a dual-currency system allowing players to redeem winnings for cash or prizes. Beyond operators, the legislation also seeks to penalize ing entities, including financial institutions, payment processors, geolocation providers, and s.

Under the bill, any company aiding in the operation or promotion of sweepstakes games could face fines of up to $100,000 per violation and potential loss of licensure. A similar approach is gaining traction in Maryland, where a sweepstakes ban bill recently ed the Senate and is under House consideration.

The Social and Promotional Games Association (SPGA) strongly opposes the bill, describing it as an overreach. In a statement to SBC Americas, the SPGA criticized the committee’s expedited approval process, arguing that the legislation misrepresents sweepstakes gaming and disregards industry input.

“The legislature’s failure to consider industry expertise is deeply concerning,” the statement read. “New York lawmakers must reconsider this flawed bill before it causes irreversible economic harm.”

Similar legislative efforts are under review in several states, including Mississippi, Florida, Nevada, and New Jersey. In Mississippi, a bill banning sweepstakes operators has cleared both legislative chambers, though sports betting language was later added by the House before returning to the Senate.

Addabbo Emphasizes Consumer Protection and Enforcement

Ahead of the committee vote, Addabbo reiterated his goal of shielding consumers from unregulated gambling enterprises. “Many of these operators are based offshore, making enforcement difficult, and they frequently target vulnerable populations such as youth and seniors,” he said in a recent podcast.

The senator further argued that sweepstakes operators allow s to purchase virtual currency, which can later be redeemed for cash, effectively functioning as gambling. “The use of money to play a game and win more money is simple gambling and should be safely regulated,” he asserted.

If enacted, the bill would grant enforcement powers to the New York State Gaming Commission, state police, and the Attorney General’s Office. The law would also clarify that online sweepstakes casinos constitute illegal gambling and introduce penalties for noncompliance.

The legislation will now be reviewed by the full Senate as New York lawmakers continue to evaluate its potential impact on the gaming industry.

Source:

‘’Senate Bill S5935’’, nysenate.gov.