Maryland House Approves Online Sweepstakes Casino Ban, Senate to Decide

Maryland took another step in the direction of banning online sweepstakes casinos by approving a new piece of legislation.

The House of Delegates passed House Bill 295, which would ban these controversial gaming platforms from operating in the state. House Bill 1226, which would serve as the authoritative complement for enforcement, is also making its way through the House.

A successful ban on  sweepstakes casinos would add Maryland to a growing list of jurisdictions that are aiming to ban the controversial dual-currency-based platforms.

Maryland looking to ban sweepstakes casino

It was a long time waiting for HB 295, which received its first hearing on Feb. 5 in the Ways and Means Committee, which is also its sponsor.

The proposal did not pass with much of a struggle, receiving a 105-24 vote from the state House. Its next stop will be in the Senate, where it can be approved and possibly sent to the Governor’s desk.

Sweepstakes casinos allow but do not require customers to make purchases to play online casino games. They operate in a legal gray area, but have consistently drawn the ire of state regulators, especially over the last couple of years.

The new bill would institute criminal penalties for any online platforms that offer or mimic casino-style gaming and “[utilize] multiple currency systems of payment allowing the player to exchange the currency for any prize or award or cash or cash equivalents.” In other words, it would outlaw dual-currency systems.

If the current framework is approved, anyone found guilty of violating the new law would be liable to serve up to three years in prison and pay $10,000-100,000 in penalties.

What are the chances of approval?

While the bill has internal support from lawmakers, it is also being supported by the Maryland Lottery and Gaming Control Agency, the state’s primary gambling regulator. 

Representatives of the agency claimed that sweepstakes casinos offer illegal gambling services to Maryland residents and guests, and the Agency is unable to regulate them.

Del. Jefferson Ghrist (R-36) engaged in a brief debate regarding the terms of the bill last week. Specifically, he questioned if the bill would target platforms also offering free-to-play games, or if it only applied to games with prizes. 

Del. Jheanelle K. Wilkins (D-20), Chair of the Ways and Means Committee, clarified that the bill only dealt with platforms offering prizes of real value. The bill was approved by a vote the following day.

The Senate has already heard two bills, including SB 112, a companion bill to HB 295. That bill did not progress since its initial hearing on Jan. 28.

Monday marked the crossover deadline, meaning that if HB 1226 was going to be approved, it needed to happen then. Approving the bill would authorize the appropriate state officials to issue cease-and-desist orders, block payments and access to the platform, and launch criminal and civil penalties against illegal operators. 

The Senate already passed a bill to ban online sweepstakes casinos last year, although that bill failed in the House. Approval this time around would group Maryland with Indiana, which passed a sweepstakes ban earlier this month.