Montana to Crack Down on Unlicensed iGaming with New Bill

Lawmakers in Montana are looking to tighten the state’s regulatory measures against unregulated online gaming. To that end, Senator Vince Ricci introduced Senate Bill 555, which seeks to amend the definition of internet gambling in order to tackle online casinos and crypto operators.

The Bill Proposes Changes to How Online Gambling Is Defined

SB 555, which was amended for the current legislative session, proposes broadening what is considered illegal internet gambling to include online casinos and crypto betting operators. At the same time, the bill will keep certain exceptions for nonprofit raffles, the state lottery and simulcast facilities.

The bill seeks to change legal terms to define strict definitions for what is considered illegal online gambling and what is not. Its backers intend to block players from gambling via communication technologies no matter the type of payment. For comparison, the current Montana law doesn’t strictly prohibit online casino games using digital assets, such as cryptocurrency, to place bets.

The legislation, which explicitly addresses online casinos using cryptocurrency, seeks to end the aforementioned loophole, which has allowed some online casinos to operate by using payment alternatives.

SB 555 Will Criminalize Online Casinos

The bill will also update the penalties violators will face. Since SB 555 prohibits platforms from not only hosting online gambling but promoting it too. This means that online gambling will effectively be criminalized in Montana.

Under the bill, the promotion of such products will become a misdemeanor. Operators of online casinos, meanwhile, will risk up to 10 years in prison, fines of up to $50,000, or both. Violators would also risk any licenses they may have in other states and will be permanently barred from obtaining licenses in the future.

Sweepstakes Operators Are Wary of the Bill

Gaming lawyer Daniel Wallach, however, is concerned about the current language. He told gaming news outlet NEXT.io that SB 555 could cause certain problems. He emphasized that the bill’s authors “did themselves no favors by using the nomenclature “bet or wager” since there is always a debate over what constitutes betting or wagering.

Representatives of the Social and Promotional Games Association (SPGA), an industry body promoting responsible sweepstakes, likewise contacted NEXT.io, noting that the current wording may prohibit certain free-to-play games too. Because of that, the SPGA believes that legislators should be really careful about the amendments’ wording, lest it has unintended consequences.

Sweepstakes, in particular, have remained a fairly controversial market. Since operators of such social casinos allow gaming with a digital currency instead of money, players can effectively enjoy these products for free. Critics, however, have slammed sweepstakes as illegal gambling since they allow players to purchase digital currency with real money and therefore still lose money.

Since SB 555 seeks to prohibit platforms that allow consumers to place bets and wagers using any form of currency and offer prizes and rewards, it would effectively prohibit sweepstakes too.  

The bill passed the Senate with overwhelming approval and will now be discussed by House representatives.