Officials from the state of New York have launched a major crackdown on sweepstakes online casinos, issuing an order to 26 sweepstakes platforms to cease operations.
This move follows a combined investigation by the New York Attorney General’s Office and the State Gaming Commission, which tagged dozens of sweepstakes websites offering casino games that could be potentially converted into real-world prizes.
The state officials said that these operators offer services that strongly resemble traditional gambling, which is why the state took action to completely shut them down.
Attorney General Letitia James confirmed that these sweepstakes platforms were offering slots, table games, and sports betting using in-house virtual currencies that allowed users to cash out via real prizes such as gift cards or money.
Despite claims of “free play,” the platforms promoted the purchase of virtual coins, which under New York law qualify as illegal gambling when prizes of value are involved.
Letitia James commented:
“These online sweepstakes casinos are illegal, dangerous, and can seriously ruin people’s finances.
Moreover, James stated that these unregulated platforms operate without proper licenses, audits, or player protection systems, and as such, they pose serious risks for fraud and unfair play.
Senator Joseph Addabbo also supported the crackdown, warning that these sites frequently appeal to younger users and collect personal data without proper oversight.
Brian O’Dwyer, Chairman of the Gaming Commission, called the platforms “unscrupulous, unsecure, and unlawful.”
Some major brands affected by this decision include Chumba Casino, McLuck, Yay Casino, Global Poker, High 5 Casino, and Fortune Coins.
As a result, some companies had already started withdrawing from New York, including Chumba’s parent company Virtual Gaming Worlds, which announced its exit in May amid rising legal scrutiny.
In response to the crackdown, the Social and Promotional Games Association (SPGA) criticized the Attorney General’s remarks, arguing that many platforms comply with federal law, pay taxes, and support responsible gaming.
Additionally, the SPGA claims that the enforcement action conducted by the state of New York against sweepstakes casinos ignores compliant operators and stifles innovation.
Despite the backlash, the message of the state of New York is clear: unregulated online gambling will not be tolerated.
