Connecticut Joins New Jersey and Maryland in Bid to Curb Sweepstakes Casinos

A flurry of bills in states across the Northeast aims for the heart of the sweepstakes casino model. Connecticut was the next to act last week with Senate Bill 1235. This bill would ensure that anyone conducting sweepstakes or promotional drawings would prohibit participation in real or simulated online casino gaming or sports betting. 

It would also redefine specific gaming terms, allow for some limited wagering on boxing and MMA, require vendor and affiliate licensees to open up their books, and outlaw lottery ticket resales and courier services.

The bill was referred to the Joint Committee for General Law. It's scheduled for its first public hearing on February 14th, but no word yet on whether it will receive a committee vote or move to the Senate floor for a full discussion. 

Also, last week, another Senate Bill, SB860, was filed in Maryland in hopes of rolling back sweepstakes betting in the Free State. It took an even less nuanced approach, stating that a person may not operate, promote, or conduct an online sweepstakes game in the state.

It also threatened to go after geolocation providers, financial institutions, and payment processors with a misdemeanor charge but the loss of their ability to be licensed in the state, which would almost certainly mean that they wouldn't be able to be licensed in most gambling states.

It's not entirely a novel approach. Knapp vs. VGW Holdings was, until last week, a case brought not only against sweeps operator VGW, owner of LuckyLand Slots and Chumba Casino, but also its payment processor WorldPay. WorldPay attempted to sever itself from the case early on and was denied. 

Still, on February 7th, the judge in the US district court for the Middle District of Florida remanded the case to the Delaware District Court due to contractual agreements that specifically call for forum selection. The plaintiffs had hoped the case would be sent to Florida state court, where state statutes would almost certainly have left VGW with little leeway in their arguments about what defines gambling.

Still, this attack on payment processors, financial service providers, and even companies that provide ancillary services like geolocation or age verification is likely to be repeated in both civil suits and state legislation because it allows for the easiest way to inflict real severe damage to the sweepstakes model.

The Maryland bill is before the Senate Budget and Taxation Committee and is scheduled for a public hearing on March 5th.

New Jersey was one of the first states to act in this legislative session, introducing A5196 in mid-January. In the Garden State, sweepstakes casinos would be reclassified as internet casinos and would need to be licensed under New Jersey's notoriously strict Division of Gaming Enforcement (NJDGE). 

Even more onerous, they would need to partner with a land-based casino, as all online casinos must in New Jersey. While the lobbying group for sweepstakes casinos, the Social and Promotional Games Association (SPGA), has said it welcomes this type of legislation, it may have misread the room. 

The NJDGE is unlikely to license any sweeps operator that has already been operating illegally in the state. Similarly, many of the state's land-based operators are unlikely to see the need to partner with these websites of dubious origins, as they already have licensed, regulated, and vetted online casino partners. 

The bill currently sits in the Assembly Tourism, Gaming, and the Arts Committee and has not yet been assigned a time for a public hearing. 

Writing on the Wall

While the odds of any of these three bills passing aren't great, it's clear that legislatures not just in the Northeast but all across the country are looking to weed out competitors for their licensed and regulated casinos and minimize the impact on consumers from untaxed and unregulated gaming. 

Once the online casino industry finds legislation that works to do that and is palatable to not only state lawmakers but also their constituents, copycat legislation will likely follow. So, while 2025 may be the year of throwing bills at the wall to see what sticks, sweepstakes operators will need to pay close attention to the legislative sessions in many more states in 2026.