American Gaming Association calls on regulators to probe sweepstakes operators
The AGA has warned that sweepstakes operators are evading state gambling laws and regulations.
US.- The American Gaming Association (AGA) has issued a warning about the growing popularity of sweepstakes-based gambling in the US. Issuing a new policy statement on sweepstake casinos and sportsbooks, the trade group warns that sweepstake operators are operating outside of state gambling laws and regulations.
The sweepstakes model allows customers to play for free or to buy virtual currency to enhance gameplay and gain the chance to receive cash prizes. Operators claim that this dual-currency model is permitted by law. However, the AGA warns that sweepstake operators cost US states in lost potential tax revenue and present a greater risk for players since they don’t face regulatory scrutiny.
The trade association has called on state regulators and governments to investigate operators that offer sweepstake wagering to determine if they comply with state regulations.
It said in a statement: “The lack of regulatory oversight presents many risks for consumers as well as the integrity and economic benefits of the legal gaming market through investment and tax contributions. These sweepstakes-based operators have weak (if any) responsible gaming protocols and few, if any, self-exclusion processes.
“Where state laws and regulations are not clear, legislatures should consider enacting legislation to prevent unlicensed operators from exploiting loopholes in sweepstakes regulations to offer online real money gambling.”
Some states, such as Delaware and Michigan, have taken action against sweepstake wagering operators. Delaware issued a cease-and-desist order to Virtual Game Works, but the company has not yet complied. The same company was forced to shut its operations in Michigan.
See also: Michigan igaming and sports betting revenue reaches $220.8m in July
