The Minnesota Senate adopted SF 4474 and SF 4511 on April 30. SF 4474 passed by a 62-3 vote, while SF 4511 passed as amended by 56-10.
Minnesota lawmakers can meet in regular session until May 18, unless the Legislature adjourns earlier. There will be no room left for lengthy negotiations should either of the two bills change during that time.
Sweepstakes Bill Reaches Beyond Operators
SF 4474 focuses on online sweepstakes games that use a dual-currency model. The bill defines the target as an internet or mobile-accessible game that lets users exchange one form of currency for prizes, cash, cash equivalents, or a chance to win them, while simulating casino-style gambling.
The bill goes beyond merely prohibiting operators of such websites. It would also bar the following parties from supporting the operation, conduct, or promotion of an online sweepstakes game in Minnesota:
- Applicants;
- Licensed entities;
- Financial institutions;
- Payment processors;
- Geolocation providers;
- Gaming content suppliers;
- Platform providers;
- Media affiliates.
This means that the bill is going to restrict the entire supply chain. Violations would fall under Minnesota’s prize notice statute, which allows penalties for intentional violations, including a fine of up to $10,000, imprisonment for up to two years, or both. The bill also grants the commissioner of public safety enforcement roles.
Prediction Markets Face Felony Treatment
SF 4511 takes a tougher stance in criminal law toward prediction markets. The proposal makes it a felony, when done for consideration and as part of a business, to create, operate, manage, control, or intentionally facilitate a platform or system used for prediction market wagers. This category is extensive and includes the following:
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Sports competitions;
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Player performance statistics;
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Gambling games;
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Election outcomes;
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Government conduct;
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Legal proceedings;
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Deaths;
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Mass casualty incidents;
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Short-term weather;
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Wars;
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Natural disasters;
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Popular culture events;
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The likelihood of a specific person making a certain statement.
Marketing is also covered. Under the Senate bill, it will become a felony to promote or advertise financial or technological products connected with illegal prediction market activities. These criminal provisions would become operational from August 1, 2026, for crimes committed on or after that date.
House Route Is Not Fully Settled
The House does have companion language pending, but the track is slightly different for each issue. On April 30, it passed a wider public safety policy package that contained an amendment banning prediction market wagering. Due to the amendment being added to this legislation, it will now have to be returned to the Senate for approval.
When it comes to sweepstakes gambling, it is up to the House to determine whether it should use the language from the Senate bill or create their own version. Any changes would slow the process because the chambers would need to reconcile the text.
Takeaways
Minnesota’s debate is no longer only about whether these products resemble gambling. It appears that the Senators are trying to stop gray-market products from reaching the state’s residents. Operators, therefore, should note that Minnesota is shifting its focus from warning notices to statutes that would be enforceable across the wider online gambling supply chain.
