New York Senate Committee Advances Bill to Ban Sweepstakes Operators

Residents in the Empire State may be running out of time to play sweepstakes games.

This week, the New York Senate Racing, Gaming, and Wagering Committee unanimously passed a bill banning sweepstakes gambling. The victory sets S5935 up for a vote on the Senate Floor, bringing it a step closer to becoming law.

A companion piece of legislation is being considered in the New York Assembly but has yet to move past a committee review.

What Are Sweepstakes Platforms?

Sweepstakes casinos and sportsbooks allow customers to gamble without using real money. Instead, users purchase or earn gold coin packs to place wagers. This allows them to experience gambling without the risk of significant financial losses. Instead, these platforms focus on social interaction as a way for bettors to scratch their competitive itch.

The lack of real-money wagers and prizes allows sweepstakes platforms to operate in most of the US, even in some states where real-money gambling remains illegal. This has led to a massive spike in popularity but has also drawn the attention of the gambling industry and many lawmakers.

Bill Sponsor Aims for Increased Regulations

New York Senator Joe Addabbo proposed the S5935 to regulate sweepstakes operators. He believes that these operators have been offering gambling while avoiding the regulations and taxes that real-money operators are subjected to. This can mean that residents could be more susceptible to problem gambling despite the lack of real-money wagers.

Addabbo has also pointed out that these platforms are cutting into the revenue of regulated gambling markets. That hurts those operators and means less tax revenue for the states. Given the massive financial success of legal gambling in the US, both parties are eager to clamp down on the emerging sweepstakes industry.

Are Sweepstakes Platforms Dangerous?

While sweepstakes platforms don’t accept real money wagers, it is still possible for customers to overspend on packs of coins. Big prizes can be enough to tempt those struggling with gambling addiction and lead to devastating consequences.

Despite this, many responsible gaming advocates have viewed the sweepstakes industry favorably. They believe bettors having the option to wager with a sweepstakes platform can help curb problem gambling and protect bettors. Most platforms also offer free ways for players to earn coins, meaning customers can play without needing ever to purchase a pack.

The sweepstakes industry promotes itself as giving bettors a safer and more social way of gambling, but we’ll soon see if New York lawmakers agree.