New York Seeks to Snuff Out Sweepstakes

New York Senator Joseph Addabbo has launched a bill seeking to put an end to sweepstakes in the state. Despite the social casino industry’s opposition, he has remained adamant that such products should not compete with legal gaming options.

Addabbo Wants iGaming, Not Sweepstakes

Addabbo is known as one of the most fervent supporters of safe, regulated and legal gambling in New York. He has championed the expansion of the Empire State’s industry for years, fighting for the legalization of various verticals.

Social casinos, however, are not on the senator’s to-do list. On the contrary, like many defenders of legal gaming, he has firmly opposed the sweepstakes model, which according to critics constitutes unregulated gambling.

The sweepstakes model is a type of gaming where players wager a digital currency. This currency can either be gained for free via various rewards or initiatives, or purchased for real money. Since sweepstakes do not technically require a player to spend real money, proponents of the vertical argue that it doesn’t constitute gambling.

However, sweepstakes can still be addictive and cause players to spend more than they can afford, which has been a principal argument of their critics.

The Bill Provided a Clear Definition of What Will Be Illegal

On March 4, Addabbo sponsored Senate Bill S5935, proposing a strict ban on sweepstakes and revenue from illegal markets.

The measure clarifies that sweepstakes are games, contests and promotions that are made available online and/or accessible via a mobile device, and leverage a dual-currency system. The description further clarifies that sweepstakes are contests that allow players to exchange the currency for any prize, award, cash or cash equivalents and simulate casino-style games. Finally, the bill notes that the definition does not include games that do not award cash prizes or cash equivalents.

Addaboo emphasized that he remains committed to protecting the people of New York from unregulated gambling. To that end, he remained adamant that the loophole allowing sweepstakes should be closed, mirroring similar action in Idaho, Michigan and Washington.

At the same time, Addabbo will continue pushing for the legalization of iGaming.

SPGA Says the Ban Would Be a Waste of Resources

The Social and Promotional Games Association (SPGA), an industry body promoting a responsible sweepstakes sector and championing the rights of the sweepstakes industry, recently responded to the mulled ban, critiquing New York and warning of potential adverse effects.

According to the SPGA, the new bill might hurt small businesses and restrict personal freedoms in New York. The association proposed sensible regulation and taxation of sweepstakes games instead, saying that it is prepared to work with policymakers to ensure a regulated future for the sector.