New York Sen. Joseph Addabbo’s proposal to ban sweepstakes casinos from the state has moved closer to becoming law after the bill received amendments to clarify which websites fall under the prohibition and expand the number of state agencies able to investigate potential violations. The amended version of Addabbo’s bill has advanced to the Senate calendar for a floor vote. It earmarks funds received from fines for responsible gambling education and treatment of problem gambling.
The Assembly companion bill is further behind in the process, but could get fast-tracked if the Senate passes Addabbo’s legislation. Meanwhile, many of the operators of sweepstakes-model social casinos have already voluntarily stopped serving customers in the state.
Amendments push S5935 forward
Addabbo’s 5935 has been replaced by a substitute, S5935A, with a vote of the full Senate pending. Compared to the version that got approval from the Senate’s Racing, Gaming, and Wagering Committee, S5935A has several important updates:
- Adds the New York Atty. Gen’s office and the New York State Police to the state entities that can investigate, including with subpoena power, potential violations of the law
- Clarifies the definition of “online sweepstakes game”
- Declares that the New York State Gaming Commission (NYSGC) will define “dual-currency system”
- Specifies that fines collected for violations of the statute will be deposited into the Commercial Gaming Revenue Fund
- Updates the definitions of “lottery games” and “table games”
S5935A maintains crucial aspects of Addabbo’s filing, including a provision that renders it “unlawful for any applicant, licensed entity, gaming employee, key employee, individual investor or investment firm, board member, or any other person or entity to operate, conduct, or promote online sweepstakes games.” Additionally, vendors who service a website supporting such games would be in violation of the law, too.
Convictions upon charges of violating the statute carry a fine of at least $10,000 and no more $100,000. In anticipation of S5935A becoming enshrined in the New York code, some companies that would be affected have made preemptive moves.
Sweepstakes-based casinos pull out to avoid confrontations
Since Addabbo introduced his bill, multiple companies that offer casino-style, sweepstakes-based online casino games have stopped accepting entries from people in New York. According to Chav Vasilev of Gaming Today, that includes High 5 Casino, McLuck Casino, and NoLimitCoins.
Other operators have yet to pull that trigger, though. A prime example is VGW, which owns the prominent Chumba Casino and Funzpoints brands. The latest update (April 11, 2025) of the conditions and terms for the Chumba Casino website do not list New York among the states it deems people ineligible for entry if they play within.
VGW has responded to enforcement actions in other states like Delaware and Michigan. That makes for a potential New York exit if S5935A does become law.
More immediately, though, VGW and other sweepstakes-based casino site operators have a chance to try to sway legislators in New York against the bill. There is a lobbying entity, the Social and Promotional Games Association (SPGA), that could attempt to bend Senators’ ears and/or enlist the support of members of the New York Assembly.
The SPGA’s arguments have included that federal laws governing sweepstakes override any prohibitions on the games on the state level. The SPGA has also stated that such restrictions would affect the legality of promotions offered by a wide range of businesses and not just their online casino-style games.
However, Addabbo’s bill counters those concerns by specifying that S5935A’s tenets apply only to casino-style online games that utilize a dual-currency system. The provision to give the NYSGC the power to define that currency system could be both a bug and a feature of the statute.
Regulator judgments could leave room for court challenges
Leaving the NYSGC room to adapt a crucial part of this statute has one clear benefit. It gives New York’s gaming regulators the ability to respond to changes that operators make to their offerings to try to navigate around the law.
However, that “cat and mouse game” could also create space for affected companies to challenge the NYSGC’s definition in court. At the same time, that would depend on operators’ resolve and resources to wage what could be a costly, prolonged legal battle.
So far, just the threat of S5935A has been enough to make many sweeps-based gaming companies pull out of New York. Senate passage might spur some of the remaining providers to do the same.
