Sweepstakes-style online-gambling sites have grabbed the attention of an increasing share of the gambling world, often with widespread calls from more traditional online operators for such sites to be banned.
With their use of a dual-currency mechanism employing both play-money coins and 'sweeps' coins, the latter of which can later be exchanged for cash or prizes, such sites believe they have successfully found a legal loophole that allows them to operate not only across the US, but around the world as well.
Many jurisdictions, both in the US and abroad, have begun to crack down on the sweeps segment. But in one of the most successful of all regulated-iGaming US states, New Jersey, an assemblyman has a different idea: Just declare sweeps sites, officially, as a recognized form of real-money online gambling, and then set into place licensing and regulatory frameworks that are intended to force such sweeps operators into a properly authorized framework.
On January 16, New Jersey Assemblyman Clinton Calabrese introduced his Assembly Bill 5196, which may be the first state-level bill anywhere in the US regarding sweeps sites that seeks not to ban them, but to license them. Since the sweeps sites operating unofficially in New Jersey's online market already offer the types of games that New Jersey regulates, much of the needed framework is in place.
“Sweepstakes casinos have operated in a regulatory gray area, which has led to significant challenges, including consumer protection concerns, underage gambling, and economic losses for the state,” said Calabrese. “Recognizing these issues, I have introduced this legislation to address the lack of oversight for these platforms."
New sweeps association welcomes bill
Whether Calabrese's bill can generate significant support is unknown at this early stage, since it represents an olive branch to the grey-market sweeps industry that already-licensed operators in New Jersey might lobby against as a way of protecting their online turf. However, a new lobbying group representing numerous US-facing sweeps has already signaled its support for the measure.
Last September, the Social and Promotional Games Association announced its launching on behalf of 11 member sweeps-based firms, though the association's lineup does not include the largest sweeps operator on the planet, Virtual Gaming Worlds (VGW), which offers Chumba Casino, Luckyland Slots, and Global Poker.
VGW aside, the SPGA operators quickly embraced Calabrese's measure. In a press statement, the lobbying group declared, “The SPGA welcomes Assemblyman Calabrese’s bill. The SPGA and its members are advocates for clear regulations that enable transparent, innovative, and responsible social and promotional gaming experiences.”
For now, Calabrese's A5196 rests in its initial committee waystation, the New Jersey Assembly's Tourism, Gaming and the Arts Committee. Any such bill faces a lengthy path through both houses of New Jersey's legislature before being considered for signing into law by the state's governor, Phil Murphy.
