A bill prohibiting online sweepstakes operators in New York took a significant step this week.
The Senate Racing, Gaming and Wagering Committee advanced Senate Bill 5935 on Tuesday. Sen. Joe Addabbo, who chairs the committee, introduced the online sweepstakes bill after telling LSR earlier this year that the operators offered unregulated gambling in the state.
“Whenever you go into the arena of gaming, you want to make sure it’s regulated so it’s a safe product for New Yorkers,” Addabbo told LSR earlier this year. “It’s really about ensuring it’s a safe product. Sweepstakes, they’ve gotten around a loophole, but if you use money to buy the coins and it equates to greater cash prizes, that’s gambling.”
Addabbo’s counterpart in the Assembly introduced a companion bill.
Sweepstakes association denounces movement
The Social Promotional Games Association released a statement denouncing the committee’s action on Addabbo’s proposal. The SPGA said the legislation was “rushed through” the committee “without proper scrutiny.”
“This legislation recklessly mischaracterizes sweepstakes gaming and threatens legitimate businesses with unnecessary and harmful regulation,” the statement reads. “Even more alarming is the legislature’s disregard for industry expertise. Instead of engaging stakeholders, lawmakers have fast-tracked a bill that would not only undermine the sweepstakes sector, but also send a chilling message to venture capitalists and tech entrepreneurs.
“Criminalizing legitimate business innovation threatens to drive investors away, putting New York’s entire tech economy — including AI and other emerging technologies — at a severe disadvantage compared to more forward-thinking states.”
States take on online sweepstakes
At least seven state legislatures have active online sweepstake prohibition bills.
That includes Mississippi and Maryland, where both state senates have passed the legislation. Maryland’s bill awaits a House hearing, while the Mississippi House inserted online sports betting language.
Other states with active legislation:
- Connecticut
- Florida
- Nevada
- New Jersey
An industry source told LSR there could be another two state legislatures entering the conversation to prohibit sweepstakes soon.
