This week saw a significant increase in legislative efforts to ban sweepstakes casinos, as lawmakers intensified their scrutiny of unregulated gaming sectors, including prediction markets and high-risk betting products.
In the U.S., various bills aimed at regulating these areas advanced through committees and floor votes. Maine is on the verge of prohibiting sweepstakes casinos, while Maryland and Minnesota are also moving forward with similar measures. Concurrently, the pressure on prediction markets is mounting, with new federal proposals and heightened oversight emerging, alongside state-level initiatives in Minnesota and Tennessee.
Maine Moves to Ban Sweepstakes Casinos
The Maine House of Representatives passed LD 2007, titled “An Act Regarding the Prohibition of Online Sweepstakes Games,” on March 26, with a vote of 88-55. This legislation now awaits the signature of Governor Janet Mills.
The bill specifically targets “sweepstakes games,” which are defined as any online game or promotion utilizing a dual-currency system that offers casino-like outcomes. If signed into law, Maine would become the second state, following Indiana, to ban sweepstakes casinos by 2026.
Maryland Passes Two Key Bills on Sweepstakes
In Maryland, lawmakers successfully passed HB 295 and HB 1226 just before the chamber crossover deadline. HB 295 introduces a new criminal prohibition on “interactive games” that employ multiple currencies redeemable for prizes or cash while mimicking casino gaming, lottery games, or sports betting.
HB 1226 serves as an enforcement measure, granting regulators expanded powers, including the ability to issue cease-and-desist orders, block payments and access to platforms, and pursue both civil and criminal penalties.
With one chamber having passed a ban on sweepstakes casinos, Maryland is now among the states moving quickly on this issue, with both bills already set for Senate hearings.
Minnesota Takes Action Against Sweepstakes Casinos
In Minnesota, House committees have advanced two bills aimed at banning sweepstakes casinos: HF 4474 and HF 4410. Both bills contain similar language and target dual-currency payment systems.
HF 4474 has been scheduled for a second committee meeting, and if it continues to progress, it could soon reach the House floor for a vote. The advancement of these bills reflects lawmakers' growing willingness to address the issue, particularly in light of Minnesota's lack of legalized sports betting.
Louisiana's Racketeering Bill Affects Sweepstakes Operators
In Louisiana, HB 53 has passed out of committee with unanimous support and is set for floor consideration. This bill expands the state’s racketeering statutes to encompass additional gambling-related offenses, including “Gambling by computer” and “Gambling by electronic sweepstakes device,” which could have direct implications for sweepstakes casinos.
While not specifically targeting sweepstakes casinos, the broader racketeering exposure could significantly increase legal risks for operators if certain gambling-related activities are prosecuted under these expanded criminal frameworks.
Minnesota Moves to Ban Prediction Markets
Alongside the sweepstakes casino ban, Minnesota lawmakers also advanced HF 4437, aimed at prohibiting prediction markets. This bill would outlaw event contracts related to sports, elections, and other real-world outcomes, extending these restrictions to payment processors and financial institutions involved in such transactions.
By targeting both operators and the financial systems that support them, Minnesota's approach is notably comprehensive.
Tennessee Advances Prohibition Bill
Tennessee lawmakers have moved forward with SB 1992, which would classify influencing the outcome of an event while participating in a related prediction market as a Class E felony. Its companion bill in the House, HB 2079, has also made progress and is awaiting further deliberation.