UNITED STATES—Sweepstake casinos have gained huge popularity across the US, however, they remain in a gray area when it comes to their legality. Many states across the US, including California, have strict anti-gambling laws and regulations. Attorney Generals may start to target sweepstakes casinos in a bid to regulate and dismantle the industry. Sweepstakes in California now face significant legal challenges, with serious potential actions from California’s Attorney General.
Online Gambling in California
California has long maintained strict laws around online gambling and strict regulations for land-based gambling establishments as well. California prohibits most forms of online gambling. There are currently only seven states in the USA that have legalized online gambling, with many recording record-breaking growth over the last few years.
Players across the USA and the world look to online casinos for fast withdrawals, quick deposits, and a variety of games. There are many online casinos for big cashouts, as Vlad Grindu points out, which offer big payouts, large bonuses, and exciting game choices for users.
Unable to enjoy the thrilling experience of online casinos within their own state, many Californians will either opt for offshore online casinos or the alternative option of sweepstakes casinos. However, quite often sweepstakes casinos will operate more like traditional gambling platforms. This can make it difficult for sweepstake casinos to operate in states like California without scrutiny.
In 2015, California amended its anti-gambling laws. Business & Professions Code Section 17539.1 was altered to explicitly state sweepstakes casinos that ‘simulate gambling’ or include ‘gambling-themed games. This was to avoid operators taking advantage of any loopholes. This means that many sweepstakes casinos currently operating in the state could face legal consequences.
Sweepstakes Casinos: A Legal Grey Area
Due to their legal uncertainty and the lack of regulation around sweepstake casinos, many dubious platforms have continued to operate without any consequences. Platforms have sometimes faced class-action lawsuits from disgruntled players. Or have received cease-and-desist notices from state regulators. However, most of these cases don’t come to fruition and never make it to a jury – with operators choosing to settle. This is especially relevant in California, where lawsuits to recover gambling losses are barred.
One way to get around this for states is by using the civil enforcement powers of the attorney general. In California, the attorney general is authorized to sue on behalf of the people against unlawful practices, including violation of the state’s gambling laws. The Attorney General’s Office has used these powers previously to combat illegal sweepstakes gambling.
Sweepstakes Casinos in California
Given the existing legal precedent, it looks likely that sweepstake casinos in California will face heightened legal scrutiny. With a history of taking action against illicit gambling activities, sweepstake casinos could be the next target. They may follow the same procedure as other states like Florida and New York, which have already begun their crackdown on illegal sweepstakes platforms. If the Attorney General decides to follow suit, operators may face fines, lawsuits, or criminal charges.
Conclusion
The online gambling market continues to evolve and thrive, especially in the states where it is legal. We may start to see states like California double down on their efforts to control and regulate both the online gambling market and the illicit sweepstakes industry.
