California legislators propose sweepstakes ban with new prohibition bill
Amendments to AB381 mean anyone directly or indirectly working with or promoting sweepstakes operators could also face up to one year in jail
California lawmakers have looked to prohibit all online sweepstakes casinos from the state via amendments made to Assembly Bill AB381.
As per coverage from CasinoReports, amendments to the bill made by Assemblymember Avelino Valencia propose that it would be a misdemeanor to operate, promote, or support any sweepstakes titles that copy casino-style gambling.
That involves any sweepstakes operators that offer the chance to win cash or real-life prizes via online slots, table games, sports betting, bingo, and lottery-style titles.
The bill’s scope extends beyond just operators, so that any company within the industry, including payment providers, suppliers, and affiliates, found to be working in direct collaboration or indirectly with sweeps operators could face a $25,000 fine and up to one year in county jail.
AB381 looks to tighten the scope of California’s Business and Professions Code to ensure that digital and mobile sweepstakes games are added to the list of banned formats.
An exception has been made for limited-time promotional sweepstakes linked to the sale of consumer goods or services, so long as they do not operate like online casinos or reward participants with real money.
It is believed that celebrity endorsement of sweepstakes would also be banned under AB381, bringing an end to the kind of marketing practices that have seen involvement from Drake, Paris Hilton, and Ryan Seacrest.
Given the California constitution limits gaming to tribal nations, this latest development has received backing from the California Nations Indian Gaming Association.
Victor Rocha, chair of the Indian Gaming Association, has also thrown his support behind the legislation, having long been a fierce opponent of the sweepstakes sector.
In 2024, California’s 109 federally recognized tribes united with industry trade body the Sports Betting Alliance to thwart the influence of sweepstakes operators, putting aside their own differences in the process.
The amendment has been met with backlash from the Social & Promotional Games Association (SPGA), with the sweepstakes trade body accusing California lawmakers of a “backroom ban.”
A statement from an SGPA spokesperson argued: “This isn’t how sound policy gets made. A last-minute effort to outlaw legal digital games, without public debate, expert input, or economic analysis, sends a chilling message to entrepreneurs, innovators, and investors across the state.
“California voters didn’t sign on for backroom deals dictated by powerful political interests. With the state facing wildfires, a housing crisis, and a full federal assault on Californians’ rights, it’s astounding that any lawmaker would make banning mobile games a priority.”
The SPGA signed off by urging California’s Governor, Gavin Newsom, to “reject this rushed and hypocritical approach.”
Developments in the Golden State come at a time when the sweepstakes vertical is under increasing scrutiny, with New York becoming the latest state to see its Senate and Assembly unanimously pass a bill prohibiting the sector.
The ban in New York follows in the footsteps of Connecticut, Louisiana, Montana, and Nevada.
However, Louisiana’s bill was vetoed by Governor Jeff Landry, who expressed concern that the legislation covers ground already by the Louisiana Gaming Control Board, which had recently issued 40 cease-and-desist orders to a host of illegal operators, including sweepstakes casinos.