All eyes are on California this week as its controversial anti-sweepstakes invoice heads right into a second legislative listening to on Tuesday (July 15) earlier than the Senate Public Security Committee. Generally known as AB 831, the invoice would ban on-line sweepstakes casinos and slap prison penalties on operators, suppliers, promoters and even media associates.
The proposal has sparked a heated debate with teams just like the Social and Promotional Video games Affiliation (SPGA) arguing it could stifle “innovation,” whereas some tribal leaders worry it could harm communities which have already confronted historic challenges.
BACKROOM BAN: CALIFORNIA’S GUT-AND-AMEND MOVE RISKS JOBS, INVESTMENT, AND CONSUMER CHOICE pic.twitter.com/i5ewk3jEhi
— theSPGA (@theSPGA) June 23, 2025
California remains to be one in every of 10 states that haven’t legalized sports activities betting. On the similar time, each day fantasy sports activities have been operating on-line within the state for over a decade. Sweepstakes casinos, nonetheless, have grow to be a headache for regulators throughout the nation. Whereas tax issues are a part of the difficulty, the larger problem is how tough these platforms are to control.
In June, AB 831 was rewritten from the ground up by Meeting member Avelino Valencia with help from the California Nations Indian Gaming Affiliation. The up to date model is designed to shut each loophole and take away sweepstakes casinos from the state utterly.
NEW: The California anti-sweepstakes invoice will get its 2nd legislative listening to on July fifteenth at 9 am PT earlier than the Senate Public Security Committee. AB 831 would ban on-line sweepstakes casinos and impose prison penalties on operators, suppliers, promoters and media associates. pic.twitter.com/N5G7aTzDbK
— Daniel Wallach (@WALLACHLEGAL) July 11, 2025
Right here’s what it’s essential to learn about AB 831 and the way it may impression sweepstakes casinos in California.
Is sweepstakes authorized in California?
Sure, sweepstakes are typically authorized in California so long as they comply with sure guidelines. Entry have to be free and primarily based purely on probability, with no buy or fee required to enter or declare a prize. The state additionally has strict transparency and shopper safety necessities. Corporations have to obviously disclose the principles, who’s eligible, and the percentages of successful.
However California Lawyer Basic Rob Bonta isn’t a fan of how some platforms have been working. He just lately released a scathing opinion about them, saying some of these video games have usually been used to rip-off customers.
In a 33-page doc revealed earlier this month, Bonta criticized draft and decide ’em-style each day fantasy contests. He argued they cross a line “as a result of they contain betting on sporting occasions.”
On the State of California Division of Justice web site, Bonta had already warned: “1000’s of firms use sweepstakes playing cards, letters, and calls—or the promise that you’ve received a prize—to entice customers to ship cash, surrender their private info, or hearken to a persuasive gross sales pitch. Usually, customers give the corporate their private info, time, or cash, solely to get nothing again in any respect.”
The SGLA urged lawmakers to reject AB831 throughout in the present day’s California Senate Governmental Group Committee listening to on the invoice. Why?
AB831 would:
Ban on-line social video games that provide authorized “freemium plus sweepstakes” choices
— Social Gaming Management Alliance (SGLA) (@SGLeadership) July 8, 2025
DraftKings and Underdog are among the many firms pushing again. Underdog has stated it’s going to preserve providing fantasy sports activities in California and even tried to block Bonta’s opinion from being released. That effort didn’t work and a California state choose dominated the opinion doesn’t change current state legislation and allowed it to be revealed.
Jeff Duncan, the Social Gaming Management Alliance (SGLA)’s government director and former Congressman, stated: “This invoice isn’t about defending gamers. It’s about defending incumbents from competitors.”
The SGLA has now launched a dedicated website. Thus far, the location exhibits 21,577 actions taken, together with writing, calling, and posting to X, previously often known as Twitter, all aimed toward native lawmakers.
What per week. Sweepstakes playing will nonetheless die an unsightly dying. That’s not up for debate. As for DFS, I see this as a chance to redefine the business on our phrases.
— Victor Rocha (@VictorRocha1) July 4, 2025
On his webcast “New Regular,” Victor Rocha, convention chair of the Indian Gaming Affiliation, stated it’s “solely a matter of time earlier than the controversial twin forex type of gaming is eradicated.”
How do I discover legit sweepstakes?
Bonta has some recommendation for recognizing legit sweepstakes and avoiding scams.
For one, don’t pay to enter a sweepstakes or for the prospect to win a prize. Actual sweepstakes are free and primarily based on probability. It’s unlawful for firms to make you purchase one thing, pay a payment, or do something to extend your odds of successful. They need to offer you a strategy to enter with out spending cash, although that info is usually buried within the superb print.
Additionally, by no means pay to assert a prize. In the event you get a shock discover saying you’ve received, be cautious. Respectable prizes don’t require you to cowl “taxes,” transport charges, or some other costs.
Keep away from calling 1-900 or 900 numbers to enter sweepstakes or acquire prizes. These “pay-per-call” numbers can rack up enormous costs and are a typical lure.
“Don’t pay to enter a sweepstakes or for the prospect to win a prize. Respectable sweepstakes are free and by probability. It’s unlawful to require you to purchase one thing or pay to enter or improve your odds of successful a sweepstakes.” – Lawyer Basic Rob Bonta, State of California Division of Justice
Watch out in the event you’re requested to name a quantity, attend a webinar, or be a part of an occasion to study extra a few sweepstakes or prizes as that is usually a tactic to get you to hearken to a gross sales pitch for an overpriced product, a trial supply, or perhaps a donation.
Don’t hand over your private info like your cellphone quantity, house handle, or e mail. Getting into a shady sweepstakes may end in a flood of telemarketing calls, spam, and spam as a result of your particulars is perhaps offered to different firms.
Be careful for impressive-sounding names, official-sounding titles, and prizes that appear too good to be true. Scammers usually depend on these tips to seem credible and lure folks into handing over their cash or info.
It’s additionally price figuring out the principles about raffles. In the event you’re paying for an opportunity to win, that’s a raffle, not a sweepstakes. In California, raffles are solely authorized if run by a charitable group registered with the Lawyer Basic’s Workplace, and a minimum of 90 % of the cash raised should go to charity. You’ll be able to verify if a raffle is registered by looking the Lawyer Basic’s Registry of Charities and Fundraisers.
In the event you suppose you’ve come throughout a rip-off, you’ll be able to report it on to the California Lawyer Basic’s Workplace.
What states require sweepstakes registration?
In the USA, solely Florida, New York, and Rhode Island require sweepstakes registration beneath sure circumstances. In Florida and New York, this is applicable if the entire retail worth of all prizes is greater than $5,000. While in Rhode Island, the edge is $500, however it solely applies to retail retailer promotions. In some circumstances, bonding can be required.
In each different state, sweepstakes and contests comply with normal promotion legal guidelines with none further state-specific necessities.
Just like California, many states make it clear that winners can’t be requested to pay or purchase one thing to be able to declare their prize. For promotions tied to alcoholic drinks, there are additionally guidelines in place.
In states like Alabama, Arizona, Indiana, and Vermont, sweepstakes can not require folks to go to a licensed location to enter, and all such promotions have to be open to residents throughout your entire state.
As for tobacco-related promotions, these are utterly banned in Massachusetts, Michigan, and Virginia.
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