The most recent activity in three states suggests the same result:
- The Illinois regulators issued over 60 cease and desist letters, asking the parties to block the residents or stop offering prizes related to play.
- The Senate unanimously passed SB2104 in Mississippi (52-0) and referred it to the House.
- Jonathan Skrmetti said that multiple operators agreed to leave the state, while HB1885 advanced in early committee routing.
Illinois Links Enforcement to a Possible iGaming Framework
Through the Illinois Gaming Board and Kwame Raoul, the state is utilizing cease and desist orders to ensure that unlicensed operators exit the market. Letters published by the regulator indicate that operators targeting Illinois players with online casino games that offer a chance to win cash, gift cards, or other prizes will be subject to further action. The list of operators included in media reporting on the Illinois batch covers operators such as Stake and VGW.
In another development, a bill pending in Illinois, HB4797, proposes a framework for an Internet Gaming Act. This framework would allow for iGaming under state regulation. So, the combination of the steps is noteworthy – stop the unlicensed model now, while a regulated alternative is being discussed.
Mississippi’s SB2104 Expands the Illegal Gambling Definition
Mississippi’s SB2104 would expand the state’s existing law on the definition of illegal gambling to include online, interactive, or computerized forms of the state’s prohibited forms of gambling.
The measure passed the Senate on February 4 without opposition and is now the House’s turn. For market watchers, the vote represents the political appetite for restricting sweepstakes casino gaming while the state continues to discuss other forms of online gambling issues.
Tennessee Writes the Sweeps Model into Its Illegal Gambling Laws
Tennessee began with enforcement. On December 29, the state announced that letters issued by the Attorney General had ceased multiple operations of illegal sweepstakes casinos.
HB1885 will formalize Tennessee’s stance on the matter by defining “online sweepstakes games” and making participation and promotion thereof an illegal activity. According to legislative tracking, HB1885 was referred within the committee process on February 4.
What To Watch Next
The playbook is becoming clearer across all three states:
- Geo-blocking requests are becoming the baseline remedy.
- Definitions are being drafted that include the word “sweepstakes” in their description, not just what is included in the app.
- Consumer protection language is becoming a key part, which could include advertising, onboarding, and payment systems.
Bottom Line
For iGaming stakeholders, the safer assumption now is that more states will pair these types of campaigns with bills that eliminate any confusion over sweepstakes games. Illinois also offers a hint of a second-order effect: enforcement can arrive hand-in-hand with bills that propose regulated iGaming that can be taxed.
Obviously, such developments are to alter the landscape for both sweepstakes and regulated iGaming operators.
