Social and sweepstakes operators are mobilizing to advocate for their industry as state regulators look closer into the legality of their games.
A number of social and sweepstakes companies announced Thursday the formation of the Social and Promotional Gaming Association. A press release bills it as “an organization dedicated to providing stakeholder education and advocating for the responsible operation of social and promotional games, sometimes referred to as social sweepstakes games.”
“The formation of the SPGA is a critical step toward establishing a clear and cohesive voice for the social sweepstakes industry,” said Seth Schorr, CEO at FSG Digital Inc. “By creating this association, we are committed to helping regulators and policymakers understand how our industry’s products work and how they comply with the appropriate state and federal laws.”
The group advertised an October 1 launch webinar to discuss its plans in greater detail.
Which sweepstakes operators form SPGA?
The SPGA release names 11 members:
- 10 Ten Gaming
- Blazesoft
- Fliff
- FSG Digital
- Gold Coin Group
- High 5 Entertainment
- KHK Games
- Kickr Games
- Octacom
- Rolling Riches
- Woopla Gaming
The group’s website contends that its members “established the legality of their games and platform through a thorough legal and regulatory analysis that ensures they are compliant with federal and state laws, differentiates their offerings from gambling, and provides assurance to business partners.”
AGA asks for social, sweepstakes scrutiny
The announcement of the SPGA comes about three weeks after the American Gaming Association began circulating a memo asking regulators to examine the legality of social and sweepstakes games. The AGA represents many of the country’s largest land-based casinos and online sports betting sites.
Titled “Regulatory Vigilance Critical to Ensure ‘Sweepstakes’ Don’t Threaten Consumers and Undermine Gaming Regulation”, the memo reads in part that “sweepstakes-based” models are used to “potentially skirt gaming laws and regulations.”
“The lack of regulatory oversight presents many risks for consumers as well as the integrity and economic benefits of the legal gaming market through investment and tax contributions,” the memo reads. “These sweepstakes-based operators have weak (if any) responsible gaming protocols and few, if any, self-exclusion processes.”
The SPGA release indicates that the group includes committees focused on player safeguards and regulatory compliance.
Recent regulatory, court attention
Late last year, the Michigan Gambling Control Board ordered three sweepstakes operators to stop their operations in the state. PredictionStrike, Stake.us and VGW since stopped offering games in Michigan.
Earlier in 2023, Delaware state regulators issued a similar order to VGW to stop operating within the state. VGW, which is one of the largest operators in the space and runs primarily in the US under the Chumba and Luckyland names, is not listed among members of the newly formed advocacy group.
The company paid $11.5 million to settle a Kentucky class action suit last year. Last year, Woopla entered a settlement agreement in a separate Kentucky class action that provides $835,000 for Funzpoint Casino players.
In January 2024, a California judge sent a lawsuit filed against Fliff for alleged illegal sports betting to arbitration.
