California online sweepstakes legislation moved forward this week, with the state Senate targeting operators as Attorney General Rob Bonta declared daily fantasy sports (DFS) illegal. Tribal leaders voiced their support, asserting they have the advantage in the battle against external entities infringing on tribal sovereignty.
In a recently held Indian Gaming Association webinar, titled ‘Closing the Loopholes in California: Tribal-Led Efforts to Rein in Fantasy Sports and Sweepstakes Sites,’ tribal governments emphasized their stance against unregulated DFS and dual-currency sweepstakes operations that skate legal boundaries.
Focus on California Online Sweepstakes Legislation
The session dissected Bonta’s opinion from last week, which deemed DFS illegal under California law. It also analyzed Assembly Bill 831, backed by tribes, aimed at halting online sweepstakes gambling. Tribes are urging Bonta and California legislators to enforce the laws promptly.
Victor Rocha, IGA Conference Chair, and Brian Giles, CEO of IGA, hosted the session. Panelists included tribal attorney Scott Crowell and Joe Webster, tribal gaming attorney from Hobbs, Straus, Dean & Walker.
Crowell criticized sweepstakes operators and affiliates, arguing that they are not conducting illegal gaming while social media platforms run by tribes do similar activities. The sweepstakes firms contend the bill requires more study, cautioning against a hurried passage.
Joe Webster highlighted legislative moves in various states that are imposing sanctions and legal actions against these operators. “The avalanche is already rolling,” Webster noted, indicating the widening scope of gaming traditionally exclusive to tribes being overtaken by these external companies.
Broader Impact of California Online Sweepstakes Legislation
Victor Rocha saw his earlier predictions materializing as these operators push into California before exhausting options. The anticipated next battleground could be Texas due to similar exploitations.
Webster emphasizes the need for stronger enforcement by California, pointing out the operators’ advantage in tapping this large market sector in the absence of legal competitive products. “Everyone agrees it’s illegal, yet challenges and competition are limited,” Webster remarked.
Online Sweepstakes Legislation
Rocha noted that sweepstakes operators have launched a PR campaign against California’s measures. He dismissed their grievances as disingenuous. Crowell believes these operators are illegal even without the bill, stressing immediate enforcement.
Plans for enforcement remain a concern. Crowell argues that unless the statute is enforced, the law might lose potency over time. These loopholes need closing as states enact sweepstake laws and issue cease-and-desist letters to curb out-of-state practices.
While sweepstakes draw attention, Crowell mentions prediction-market operators like Kalshi leveraging federal agencies to dodge enforcement, posing a greater threat to regulated betting industries.
As debates over California online sweepstakes legislation continue, both Crowell and Webster underline the urgency for tribes and legal entities to ensure proper enforcement to protect their markets and sovereignty.
