New York Senate Committee Passes Sweepstakes Gaming Prohibition Bill

• New York Senate Racing, Gaming and Wagering committee unanimously passed sweepstakes gaming prohibition bill
• Sen. Joseph P. Addabbo Jr.’s bill bans sweepstakes gaming in the state
• The Social and Promotional Games Association says bill will threaten state business

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A bill to prohibit New York sweepstakes gaming was unanimously approved by a Senate committee, sending the legislation forward to the Senate floor.

The New York Senate Racing, Gaming and Wagering Committee unanimously approved Sen. Joseph P. Addabbo Jr.’s (D-15) bill, SB 5935, which takes aim at online sweepstakes games and prohibits them in the state.

“We’re looking to ban these kind of illegal, unregulated gambling sites in New York State. I love this bill, especially during problem gaming awareness month,” Addabbo said at the bill hearing.

Quick Meeting, Quick Vote

The New York Senate Racing, Gaming and Wagering Committee met for five minutes on Tuesday, March 18, approving three bills, including Addabbo’s prohibition bill. The legislation officially prohibits online sweepstakes games and revenue from illegal markets, plus laying out potential fines for operators or affiliates who offer or accept revenue from the prohibited games.

It’s a good bill to protect the state and at-risk populations, Sen. James Tedisco (R-44) said.

“A lot of kids have a lot of temptations. They don’t need another one,” he said.

The bill is now on the Senate calendar for discussion and a potential vote.

Addabbo Jr.’s bill provides the following definition of an online sweepstakes game:

“Any game, contest, or promotion that is available on the internet and/or accessible on a mobile phone, computer terminal, or similar access device, that utilizes a dual-currency system of payment allowing the player to exchange the currency for any prize, award, cash or cash equivalents, or any chance to win any price, award, cash or cash equivalents, and simulates casino-style gaming, including but not limited to, slot machines, video poker, table games including but not limited to blackjack, roulette, craps, and poker, lottery games including but not limited to draw games, instant win games, keno, and bingo, and sports wagering.”

Sweepstakes games will not include a game which does not award cash prizes or cash equivalents.

The “dual-currency” system is the key part of the definition, as sweepstakes casinos games allow users to play for free or purchase “sweepstakes coins” to play their games and exchange them for real cash prizes.

The bill sets fines of a minimum of $10,000 or a maximum of $100,000 for an operator or affiliate offering a sweepstakes casino game in the state, or accepting revenues from a sweepstakes casino company.

SPGA Criticizes the Potential Prohibition

The Social and Promotional Games Association (SPGA), a member driven organization supporting the social sweeps industry and the responsibility of its members’ offerings, criticized the bill and its passage through the committee.

“This legislation recklessly mischaracterizes sweepstakes gaming and threatens legitimate businesses with unnecessary and harmful regulation. New York lawmakers are dangerously conflating legal promotional sweepstakes with gambling, creating a broad and misguided precedent that could devastate industries far beyond social gaming,” an SPGA spokesperson said.

The SPGA called on New York legislators to “stop this reckless march toward economic self-sabotage” and reject the bill before it “inflicts lasting damage.”