On September 8, the California Senate unanimously passed Assembly Bill 831 (AB 831), a measure banning online dual-currency sweepstakes casinos, with a vote of 36-0 and four abstentions. The bill now returns to the Assembly for concurrence before it can advance to Governor Gavin Newsom‘s desk.
AB 831 makes it unlawful for any person or entity to “knowingly and willfully” engage, promote, or facilitate sweepstakes casinos that use dual-currency systems. The Senate amended the language on September 3 to ensure the legislation does not affect traditional sweepstakes and promotions. That was a significant concern among opponents.
Industry Impact Already Underway
The impending ban is likely to be a significant blow to the sector. According to an Eilers & Krejcik report, California accounts for 17.3% of the US sweepstakes casino market.
The pressure of AB 831 is already evident, and some operators and content providers are already withdrawing from the state.
Last week, High 5 Casino updated its terms and conditions, which now list California as an ineligible jurisdiction.
Meanwhile, Pragmatic Play, arguably the biggest and most popular game provider for sweepstakes casinos, exited the state and the rest of the US on September 8. Another global giant, Playtech, also decided to pull the plug on US sweepstakes casinos.
While not as readily available on the social gaming platforms, Playtech is a major supplier for regulated real-money online casinos. That likely played a role.
In the spring, High 5 Games, the creator of many DaVinci Diamonds slots, got into legal trouble in Connecticut. The state regulator suspended its license due to its connection to the High 5 Casino sweepstakes platform. The company and the regulator eventually settled, reinstating its games in the state. Still, this incident highlighted the potential risks for real-money casino licensed suppliers getting involved with sweepstakes casinos.
Smaller supplier Skywind also decided to withdraw from the sector. Meanwhile, Evolution removed its games from Stake.us, likely due to a lawsuit it is facing in California.
While its games remain available on many platforms in the state, Evolution could follow with a nationwide withdrawal. Still, given its questionable history in gray markets, it could also decide to continue offering games at sweepstakes casinos.
Tribal Opposition Intensifies
A coalition of more than 50 California Native American tribes backs AB 831. That’s because they view sweepstakes casinos as unregulated competitors that threaten the state’s regulated gaming framework. Still, a small group opposes it.
On September 8, members of the Kletsel Dehe Wintun Nation, the Sherwood Valley Rancheria of Pomo Indians, the Mechoopda Indian Tribe of Chico Rancheria, and the Big Lagoon Rancheria gathered outside the State Capitol to protest the bill.
The tribes, in partnership with the Social Gaming Leadership Alliance, warned that AB 831 would restrict digital commerce opportunities that smaller and rural tribes could rely on to fund healthcare, housing, and education programs. They also argued the bill threatens tribal sovereignty by extending state criminal penalties into Indian Country.
“AB 831 is a flawed and rushed bill that lacks broad tribal consensus,” said Jeff Duncan, SGLA executive director and former Congressman.
“What California lawmakers should focus on instead is creating proper regulation that supports online social games, creates new revenue sources for the state, and protects economic opportunities for all tribes.”
Next Steps
As AB 831 was amended in the Senate (including the sweepstakes ban provision), the proposal heads back to the Assembly for concurrence.
The Assembly is expected to take up the Senate’s amendments shortly as California’s legislative session ends on September 12. Should the chamber concur, the bill will go to Governor Newsom. The Governor has not yet indicated whether he will sign it.
If enacted, AB 831 would make California the sixth state overall and the largest in the US to ban dual-currency sweepstakes casinos in 2025. That could set a precedent for more jurisdictions to consider a prohibition this year or next.
For operators, suppliers, and tribal stakeholders, this week will determine whether California’s online sweepstakes casinos come to a definitive end.
The post California Senate Unanimously Passes AB 831, Moving Sweepstakes Casino Ban Toward Finish Line appeared first on CasinoBeats.
On September 8, the California Senate unanimously passed Assembly Bill 831 (AB 831), a measure banning online dual-currency sweepstakes casinos, with a vote of 36-0 and four abstentions. The bill now returns to the Assembly for concurrence before it can advance to Governor Gavin Newsom‘s desk. AB 831 makes it unlawful for any person or
The post California Senate Unanimously Passes AB 831, Moving Sweepstakes Casino Ban Toward Finish Line appeared first on CasinoBeats.