Tribal gaming leaders are planning a push against sweepstakes-style sports betting and casinos and newer forms of daily fantasy sports, which they see as threats to their gambling exclusivity.
On Wednesday, in an appearance on Indian Gaming Association (IGA) conference chair Victor Rocha’s podcast, leaders from IGA and the California Nations Indian Gaming Association (CNIGA) made known their intent to organize a coordinated push for regulation around sweepstakes and DFS.
The American Gaming Association could play a role in that effort, as it signaled it is open to working with tribes, who welcome more commercial allies.
Tribes plan to lead sweepstakes effort
California tribes blocked a $150 million ballot effort to legalize commercial online sports betting in 2022, the first time a state’s constituents voted down sports betting. Sunshine State tribes were instrumental in killing a Florida sports betting ballot initiative push to allow commercial operators in the state.
“If the states, the AGs, don’t crack down on them, the tribes will,” Rocha said. “We are not going in this alone. The AGA is now involved. The SBA [Sports Betting Alliance] is now involved. We can force the (National Indian Gaming Commission) to get involved.”
Jason Giles, executive director of NIGA, added that he plans to contact state gaming associations around the country to encourage them to join the effort.
Golden State tribal leaders aligned on DFS, sweepstakes
CNIGA chair James Siva believes it is incumbent on state tribes to lead the effort against sweepstakes and pick’em DFS products, but welcomed help from the commercial operators that tribes fought against in the failed 2022 California sports betting ballot push.
“If you want to go into California, you have to go through the tribes,” Siva said. “It’s the same thing we told the big sports betting companies, and I think they’re finally hearing it.”
He added, “the California leadership is primed and ready to go on this just like we were and still are on sports betting.”
California’s role in regulation
With no legal sports betting and around $200 million in annual entry fees, California is the largest DFS market in the country.
Attorney General Rob Bonta is reviewing whether the state’s gambling laws permit DFS, which Siva said has largely catalyzed tribal effort. He noted that other states have taken action with cease-and-desists, but added, “I wish I could tell you why they [California regulators] haven’t sent those letters, but I don’t have an answer for you.”
His 52 member tribes submitted comments to the AG’s office in January arguing that DFS is illegal gambling.
AGA open to working with tribes
In August, the AGA published a memo urging gaming regulators to examine sweepstakes operators. The industry lobby has been supportive of the recent states to address DFS that mirrors sports betting parlays.
“We are more than pleased to join alongside other interested stakeholders in prompting regulators and elected officials to more closely examine this sector ‘to determine whether or not these operators are in compliance with their respective laws and regulations and take appropriate action if not,’ as the AGA memo calls for,” a spokesperson with the AGA said in an email to LSR.
When contacted for comment by LSR, SBA did not confirm whether it planned to work with tribes or the AGA on the issue. SBA represents DraftKings, FanDuel, BetMGM, and Fanatics Sportsbook.
“We appreciate the focus on these unregulated operators from across the regulated industry,” an SBA spokesperson said.
Sweepstakes discussion bubbles
Social casinos and sportsbooks operate under a sweepstakes model by offering free entries upon request. They often provide two forms of virtual currency: one available for free and another offered for purchase with real money. Players use them to play games or place bets for prizes with real value.
Supporters of the model contend that sweepstakes casinos offer entertainment while allowing consumers the flexibility to participate without financial risk. In a recent video for the recent video for sweeps trade group Social and Promotional Games Association, supporters said that typically only 1% to 5% of players spend real money.
Rocha raised the question of why sweepstakes operators do not turn completely to free play, which he said would largely absolve them from infringing on tribal gaming rights.
The SPGA did not respond to a request for comment. The trade group represents a number of operators, but notably not VGW, the primary target of recent state regulatory actions.
