The New York Senate Racing, Gaming, and Wagering Committee unanimously approved legislation Tuesday that would ban sweepstakes casinos from operating in the Empire State, moving the bill to the full Senate for consideration.
Senate Bill 5935, introduced by committee chairman Sen. Joseph Addabbo, takes aim not only at sweepstakes operators but also at the broader ecosystem that supports them. The legislation would prohibit:
Financial institutions and payment processors from handling transactions
Geolocation providers from supporting these platforms
Gaming content and platform providers from supplying software
Media affiliates from promoting these services
"We have these online sweepstakes casinos that basically look a lot like casino games, but they go unregulated," Addabbo said during the committee meeting. "Right now we have a number of states, Connecticut being one of them, that basically made it illegal."
Violations could result in fines ranging from $10,000 to $100,000 per offense and potential loss of gaming licenses. Enforcement would fall to the state gaming commission, attorney general's office, and police.
The bill specifically targets platforms that use a "dual-currency" system, where players can receive some coins for free but purchase additional virtual currency that can ultimately be converted to cash prizes.
"Online real money 'sweepstakes casinos' have recently become widely available in New York over the internet on mobile devices and personal computers, including to minors," the bill states. "These products evade consumer protection, responsible gaming, and anti-money laundering requirements to which gambling in New York is otherwise subject."
During brief committee discussion, Republican Sen. James Tedisco supported the measure, saying, "A lot of kids have temptations; they don't need another one." Sen. Pamela Helming voted "aye without recommendation" after noting constituent questions.
The Social and Promotional Games Association (SPGA) condemned the bill as a "blatant overreach" that was "rushed through committee without opposition or proper scrutiny."
The organization 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."
New York joins several states taking action against sweepstakes casinos:
Maryland's Senate recently passed similar legislation that awaits House action
Connecticut's Department of Consumer Protection suspended High 5 Games' license and is pressing over 1,000 criminal charges against its High 5 Casino brand
New Jersey, Mississippi, and Florida have similar bills under consideration
The New York legislation hasn't yet been scheduled for a Senate floor vote. A companion bill introduced by Assembly Racing, Gaming, and Wagering Committee Chair Carrie Woerner remains in committee.
Currently, sweepstakes operators and offshore sites are the only way for New Yorkers to access casino-style games online, as the state has yet to legalize regulated iGaming despite Addabbo's support for such legislation.