Earlier this month, the Campaign for Fairer Gambling published a new study on microbetting, warning of the risks associated with this fast-growing form of entertainment and supporting a new measure that would ban microbetting in New Jersey, US.
Now, the Garden State is also pondering a potential ban on sweepstakes casinos, joining a growing list of states taking action against these venues following lawmakers’ approval of legislation that would prohibit them.
The Future of Sweepstakes, in the Governor’s Hands
At the start of the week, the New Jersey Senate passed Assembly Bill A5447 by a vote of 34 to 5, sending the measure to Governor Phil Murphy‘s desk. The bill had already received strong support in the General Assembly in June, where it passed 69 to 10.
If Gov. Murphy decided to sign the bill into law, sweepstakes offerings that require players to pay an entry fee or purchase virtual currency to participate will no longer be available.
The measure is specifically aimed at those platforms that use dual currency systems, a business model commonly employed by sweepstakes casinos operating across the US.
According to the bill, a sweepstakes is defined as any promotional or marketing activity that enables participants to win prizes or prize equivalents using the respective systems.
$100,000 Fines for First Offenses
The state’s Division of Consumer Affairs would be the body responsible for investigating violations and imposing penalties, which could run from $100,000 for a first offense to $250,000 for repeat law violations.
Each day an operator remains active would be treated as a separate offense, potentially leading to substantial liabilities.
The legislation, as expected, has sparked a heated debate between traditional gaming interests and the sweepstakes industry. Highlights include the Social and Promotional Games Association, representing several major sweepstakes operators, urging Gov. Murphy to reject the bill, and other industry representatives arguing that the legislation unfairly groups legitimate promotional games with illegal gambling operations.
This, they believe, could damage New Jersey’s reputation as a leader in technology and entertainment.
Bill supporters, on the other hand, believe that stronger regulations are needed to properly protect consumers and maintain oversight of gaming activities in one of the largest gambling markets in the US.
Connecticut, Louisiana, Montana, Nevada, and New York have all advanced similar legislation this year, while California and several other states are considering their own restrictions.