New Jersey’s Anti-Sweeps Bill Advances, Aims to Ban Online Sweepstakes Casinos

A bill in New Jersey aiming to outlaw online sweepstakes casinos has advanced in the Assembly after a period of inactivity. Introduced by Assemblyman Clinton Calabrese, the bill moved forward with unanimous from the Assembly’s Tourism, Gaming, and the Arts Committee.

The bill seeks to outlaw platforms that use virtual currency to offer cash prizes and introduces new penalties for illegal gambling operations. These measures will be enforced by the Division of Consumer Affairs and the Division of Gaming Enforcement (DGE).

Also, the bill addresses concerns raised by the New Jersey Attorney General’s office regarding online sweepstakes casinos exploiting legal loopholes. These platforms have been operating under the guise of promotional games, offering players virtual currencies that can be exchanged for real-world prizes.

The bill’s age marks a significant step in New Jersey’s ongoing effort to ensure that its gambling laws remain up-to-date and effective in the face of new and evolving forms of online gaming.

Legal Clarity and Impact on New Jersey’s Gambling Laws

Stephan Finkel, the Director of Legislative Affairs for the AG’s office, emphasized that the sweepstakes casinos, due to their deceptive nature, are not considered legitimate under New Jersey’s constitution, which requires approval from voters for any form of gambling.

Finkel argued that these platforms are unauthorized and exploitative, which is why clear legislation is needed. The bill’s introduction has sparked discussion around modernizing outdated gambling laws, ensuring they are more inclusive of new types of gaming, such as sweepstakes casinos.

Sportsbooks and other stakeholders have ed the bill, highlighting the risks posed by unregulated sweepstakes casinos, including the lack of consumer protections and responsible gambling safeguards. Eric Scheffler, representing the Sports Betting Alliance, pointed out that these platforms replicate the online casino experience while avoiding licensing, taxation, and regulation. This loophole undermines the integrity of the state’s established gambling system.

Amendments and Concerns About Consumer Promotions

Amendments to the bill have expanded the definition of a “game” to include any that simulate casino-style games or sports betting, as well as adjusting the definition of prizes to include virtual tokens that can be traded or redeemed for real-world value. This ensures that the law captures all forms of sweepstakes-style gambling.

However, concerns have been raised by groups like the Social and Promotional Games Association (SPGA), which warn that the bill could negatively impact legitimate consumer promotions. The SPGA pointed out that everyday promotions like Starbucks rewards or McDonald’s Monopoly could be inadvertently caught by this legislation.

To address these concerns, lawmakers have reassured the public that they are focused on ensuring the bill targets only online sweepstakes casinos, not traditional consumer rewards programs.

Penalties for Online Sweepstakes Casinos

Under the proposed bill, sweepstakes casinos could face steep fines for operating illegally. The penalties for a first offense could reach up to $100,000, with a second offense potentially leading to fines as high as $250,000.

The DGE and the Division of Consumer Affairs will be responsible for enforcing these penalties. Despite the strong opposition from some parties, the bill’s provisions aim to protect New Jersey consumers from the risks associated with unauthorized online gambling platforms.

Assemblyman Calabrese, who originally proposed a regulatory framework for online sweepstakes earlier in the year, shifted toward an outright ban after receiving from stakeholders. The bill, now numbered A5447, continues its journey through the legislative process and will next be reviewed by the Assembly Consumer Affairs Committee.

Looking Ahead: The Future of Online Sweepstakes in New Jersey

The New Jersey bill’s path reflects the state’s ongoing commitment to ensuring the integrity of its regulated gambling industry.

If ed, it will send a strong message to operators of online sweepstakes casinos, requiring them to adhere to New Jersey’s gambling laws or face significant consequences. It also highlights the state’s willingness to modernize its gambling laws to address new challenges and ensure that consumer protections remain robust.

While the bill is still being reviewed, it could have far-reaching implications for the future of sweepstakes casinos in New Jersey and other states considering similar legislation. For now, stakeholders and lawmakers continue to work together to find a balance between innovation and consumer protection in the rapidly evolving online gambling landscape.

Source:

“New Jersey Anti-Sweeps Bill Finally Takes Step Forward”, sbcamericas.com, May 9, 2025