NJ Cracks Down on Illegal Sweepstakes in New SB

Lawmakers in New Jersey are taking a tougher stance on illegal gambling disguised as sweepstakes games. 

On May 29, a Senate committee in Trenton gave the green light to a new bill designed to crack down on these unregulated operations that have been flying under the radar.

Sweepstakes, “Expressly Prohibited” Under the Bill 

Senate Bill 4282, approved by the Senate State Government, Wagering, Tourism, & Historic Preservation Committee, specifically targets businesses running sweepstakes-style gambling platforms. 

According to the bill, “sweepstakes” are defined as any promotional or marketing event, online or in-person, where participants can win something of value, even indirectly, such as via dual-currency systems.

The proposed bill would ban sweepstakes games that offer prizes in exchange for payment, either directly or through virtual currencies. 

However, not all sweepstakes would be outlawed. Exceptions include contests that allow free entry, or those tied to small purchases, like food or drinks under $20, among others. 

The text also states people under the age of 18 are not allowed to “claim a sweepstakes prize exceeding $1,000 in value without the consent of their parent or guardian”.

The goal, as lawmakers put it, is to protect consumers from deceptive and potentially harmful gambling schemes. “We will not allow bad actors to exploit legal loopholes at the expense of consumers,” said Sen. John Burzichelli.

More Power to the Agencies

SB4282 will also enable the Division of Consumer Affairs (DCA) and the Division of Gaming Enforcement (DGE) to complete more detailed investigations and take action against violators. 

Under the bill, the two agencies would be empowered to work together more efficiently to shut down illicit gambling outfits.

For example, the DCA and DGE will be allowed to “seek and obtain injunctive relief to halt any unlawful gambling operation” and enforce civil penalties of $100,000 for the first offense and $250,000 for every subsequent offense thereafter. 

Plus, the two divisions will also be allowed to seek civil penalties of $25,000 for cease and desist order violations and impose liens “on any property or assets held by a party who has been fined” according to the new bill in the previous five years. 

Senator John Burzichelli (D-3rd District), one of the bill’s lead sponsors, stressed the importance of protecting New Jersey’s long-standing reputation for strict but fair gaming oversight.

“We will not allow bad actors to exploit legal loopholes at the expense of consumers,” Burzichelli said. 

“This bill will ensure that our laws are clear, our penalties are stronger, and that we have the tools necessary to shut down illegal sweepstakes gambling operations before they can cause further harm.”, he added. 

Senator John McKeon (D-27th District), another prime sponsor, pointed out that these platforms are especially dangerous for younger residents.

“This bill will put safeguards in place to protect them and others from being exploited and drawn into gambling activities that could haunt them for years to come,” McKeon said.

A similar bill (A5447) has already cleared the Assembly’s Tourism, Gaming, and the Arts Committee, signaling broad support for the crackdown in both chambers.

Sponsors say the legislation reflects the state’s continuous commitment to protecting residents from predatory gambling operations that operate without oversight and often target the most vulnerable.

If passed into law, the bill would make it much harder for these quasi-legal gambling businesses to continue operating under the guise of sweepstakes while giving state agencies more tools to try to stop them.