New York Cracks Down on Sweepstakes Casinos

• The New York Attorney General sent cease-and-desist notices to 26 sweepstakes operators
• As a result, the operators will cease the sale of sweepstakes coins in New York
• New York legislation is still being considered to prohibit dual-currency sweepstakes

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New York Attorney General Letitia James today announced her office has ceased operations of 26 sweepstakes casino operators in the Empire State.

The Office of the Attorney General (OAG), working with the New York State Gaming Commission, identified 26 online platforms offering dual-currency sweepstakes games within the state.

After receiving cease-and-desist notices from Attorney General James, each operator agreed to cease the sale of sweepstakes coins in the state.

NY AG: Online Sweepstakes Casinos Are Illegal

According to New York gaming law, online platforms are prohibited from offering gambling that involves risking something of value, including virtual coins that can be redeemed for cash or prizes.

Sweepstakes casinos allow users to play traditional casino games, such as slot machines, blackjack, and sports betting, using virtual sweepstakes coins. Customers can purchase sweepstakes coins, which can then be won and redeemed for cash or prizes, such as Amazon gift cards.

“Online sweepstakes casinos are illegal, dangerous, and can seriously ruin people’s finances,” Attorney General James said. “I thank the New York State Gaming Commission and Senator Addabbo for partnering with my office on this issue to protect New Yorkers.”

Online sweepstakes casinos put New York customers at risk, according to the Attorney General’s office, as they are not subjected to audits and other regulatory oversight by the state to ensure that games are not rigged.

The following sweepstakes operators have agreed to cease the sale of sweepstakes coins in New York:

• Chanced
• Chumba
• DingDingDing
• Fliff
• Fortune Coins
• Fortune Wheelz
• Funrize
• FunzCity
• Global Poker
• Golden Hearts Games
• High 5 Casino
• Jackpota
• Luckyland
• McLuck
• Mega Bonanza
• NoLimitCoins
• Play Fame
• RealPrize
• Sidepot
• SpinBlitz
• Sportzino
• SweepSlots
• Sweeptastic
• TaoFortune
• Yay Casino
• Zula Casino

VGW, which operates Chumba, Luckyland, and Global Poker, announced two weeks ago it would cease the sale of sweepstakes coins in New York starting June 2.

“At a time when illegal gambling, underage participation, and identity theft are soaring, it is deeply concerning that prohibited, unregulated, and unenforceable gambling entities are providing easy access to illegal gaming sites and obtaining personal information of unsuspecting New Yorkers,” Sen. Joseph P. Addabbo Jr. (D-15).

Legislation is still being considered to outright prohibit dual-currency gaming in the state.

Legislation to Ban Sweepstakes Still Considered

Several pieces of legislation are still being considered by New York lawmakers to outright prohibit dual-currency gaming in the state.

New York Assembly bill A6745, the assembly counterpart to Senate bill S5935, received a favorable report from the Assembly Committee on Codes and has been referred to the Assembly Ways and Means Committee. Both bills seek to prohibit dual-currency sweepstakes games in the Empire State.

New York Assembly bill A6745 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.

The bill was introduced in early March to the Assembly Racing and Wagering committee and referred to the Codes committee in late April. It has sat in the Codes committee for the last month before receiving a favorable report on May 28 and being referred to the Ways and Means committee.

The bill gives the New York State Gaming Commission the power to constitute what determines a “dual-currency system of payment.” It’s typically a game where a customer has the option to pay for “sweepstakes coins” and redeem them for cash equivalents.

The bill’s Senate counterpart, S5935, was moved out of committee in late April and is currently waiting a Senate floor hearing.