The New York Senate Racing, Gaming, and Wagering Committee passed Chair Joseph Addabbo’s SB 5935 in a very brief meeting.
Addabbo, a vocal advocate for legal online casino gaming in the State who has also filed iGaming legislation in the current legislative session, told his fellow committee members that online sweepstakes offering casino-like games is “a growing issue.”
“We have these online sweepstakes casinos that basically look a lot like casino games, but they go unregulated,” he added. “Right now we have a number of states, Connecticut being one of them, that basically made it illegal. They kicked out one of their operators.
“We’re looking to ban these kind of illegal, unregulated gaming sites in New York state.”
Senators agreed to advance the proposal with two “aye” votes and one “aye without recommendation.”
“A lot of kids have a lot of temptations; they don’t need another one,” said Ranking Member Sen. James Tedisco. Another, Sen. Pamela Helming, said she “wholeheartedly agreed with the intent” but voted AWR after noting that constituents’ questions had given her pause.
In his comments, Addabbo seemed to be referencing action taken by the Connecticut Department of Consumer Protection (DCP) Gaming Division against High 5 Games this week.
The regulator has suspended High 5 Games’ license to provide online slot content and is pressing more than 1,000 criminal charges against the company’s brand High 5 Casino.
“High 5 Games took advantage of their credential to mislead consumers into believing they were participating in gaming on a legal platform when, in fact, they were breaking the law,” asserted DCP Commissioner Bryan T. Cafferelli in the department’s notice. The DCP’s position is that only DraftKings and FanDuel can legally offer online casino games in the state via partnerships with tribes.
Addabbo’s bill defines sweepstakes as any game, contest or promotion available online or via mobile that simulates some form of casino-style, lottery-style or sports betting-style gaming. To fall under the definition, the offerings must utilize “a dual-currency system of payment allowing the player to exchange the currency for any prize, award, cash or cash equivalents, or any chance to win any price, award, cash or cash equivalents.”
As well as operators, Addabbo also seeks to ban games suppliers, financial institutions and payment processors, geolocation providers, platform providers and affiliates from providing “support” to the operation, conduct or promotion of sweepstakes games. Any providers who worked with a sweeps site would be fined and stripped of their license, or denied eligibility for a license if they did not already have one.
That kind of criminalization of suppliers and affiliated parties of sweepstakes is also moving forward in Maryland, where a high-profile sweepstakes ban bill passed the Senate unanimously last week and has been referred to a House committee.
In a statement made available to SBC Americas, the Social and Promotional Games Association (SPGA) said it “strongly denounces the blatant overreach” of the bill, which it asserted was rushed through committee “without opposition or proper scrutiny.”
Stating that the legislation “recklessly mischaracterizes” sweepstakes gaming, the association added that “even more alarming is the legislature’s disregard for industry expertise.”
Ultimately, the SPGA called on New York legislators to “stop this reckless march toward economic self-sabotage and reject this deeply flawed bill before it inflicts lasting damage.”
The SPGA has also responded to active legislation in many of the several states that are mulling prohibiting or punishing online sweepstakes operators.
In Mississippi, a bill to ban sweeps operators has passed both chambers but the House lumped in sports betting language before sending it back to the Senate. Connecticut, Florida, Nevada and New Jersey all also have pending legislation to curb sweeps in at least one chamber.
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