California Assembly Bill 831 continues to be hurtling toward what would be a death knell for sweepstakes casinos in the Golden State. The California Senate Public Safety Committee unanimously voted by a 6-0 count to approve the legislation.
The bill now moves forward to the Senate Appropriations Committee. Just one week earlier, California’s Senate Governmental Organization Committee was also unanimously approving bill AB831 by a 10-0 vote.
Assembly member Avelino Valencia introduced Assembly Bill 831. The bill would make it an unfair practice to offer games that use a system of payment that enables a person to play or participate in a simulated gambling program in which the person may become eligible for a prize or award of cash in a business establishment, on the internet, or using an online application.
This is exactly how sweepstakes casino games operate. Players play with and win sweepstakes coins, which can later be exchanged for prizes that can include sums of cash.
Bill AB831 would make it unlawful for any person or entity to operate, conduct, promote, or offer an online sweepstakes game in California.
The bill would also make it “unlawful for any person, entity, financial institution, payment processor, geolocation provider, gaming content supplier, platform provider, or media affiliate to knowingly support directly or indirectly these sweepstakes casino games.”
Any person who violates these provisions would be guilty of a misdemeanor punishable by a fine not less than $1,000 nor more than $25,000, or by imprisonment in the county jail not exceeding one year, or by both the fine and imprisonment. It’s worth noting that these penalties would only be imposed on sweepstakes casino operators and industry partners. Players of these games would not be subject to any punishment.
The bill has the backing of the California Nations Indian Gaming Association (CNIGA), a powerful lobby group in the state’s gaming industry. Tribal government gaming employs more than 100,000 people. Under the state constitution, California’s tribes have exclusive rights to operate gaming in the state. The state’s tribes operate 86 casinos that annually create $5.76 billion in tax and tribal revenues.
Also backing this measure of the Sports Betting Alliance. This lobby group is an amalgamation of legal and regulated US sportsbooks such as FanDuel, DraftKings, BetMGM, Fanatics Sportsbook, and Bet365.
At the same time, a number of groups are stating their opposition to Bill AB831. That list includes the American Civil Liberties Union, the Association of National Advertisers. Also stating their opposition are two pro-sweepstakes casino lobby groups - the Social Gaming Leadership Alliance (SGLA) and the Social & Promotional Games Association (SPGA).
Rather than an outright ban, these groups would prefer to work with state government officials to find common ground on regulatory oversight for sweepstakes casino operators.
“We urge California lawmakers to listen to the thousands of constituents that have contacted their offices and work with the industry to keep this established form of entertainment legal and properly regulated,” SGLA executive director Jeff Duncan said in a press release issued by the organization.
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