While many sweepstakes operators have been relatively quiet about their businesses over the years, a new group is hoping to help communicate and educate people about the vertical.
On Thursday, 10 companies announced their participation in the new Social and Promotional Gaming Association (SPGA). Per the announcement of the group, the mission of the SPGA is “to highlight the well-established legality and legitimacy of social sweepstakes games, providing regulators, policymakers and consumers with a comprehensive understanding of these offerings.”
Two internal committees within the SPGA focus separately on player safeguards as well as regulatory compliance.
VGW not part of the list of participating sweeps operators
The member companies in the organization are:
- 10 Ten Gaming
- Blazesoft
- Fliff
- FSG Digital
- Gold Coin Group
- High 5 Entertainment
- KHK Games
- Kickr Games
- Octacom
- Rolling Riches
- Woopla Gaming
Noticeably absent from the list is VGW, the largest operator in the space and the company behind the brands Chumba, Luckyland and Global Poker.
“The formation of the SPGA is a critical step toward establishing a clear and cohesive voice for the social sweepstakes industry,” said Seth Schorr, CEO at FSG Digital Inc. “By creating this association, we are committed to helping regulators and policymakers understand how our industry’s products work and how they comply with the appropriate state and federal laws.”
Scrutiny against sweepstakes operators on the rise
The move comes as another trade organization, the American Gaming Association (AGA), recently issued a memo on sweepstakes to members stating the group “takes exception to the the sweepstakes model”. However, within the memo, the AGA also conceded that the issue of sweepstakes is not black and white.
“Where state laws and regulations are not clear, legislatures should consider enacting legislation to prevent unlicensed operators from exploiting loopholes in sweepstakes regulations to offer online real money gambling,” the memo read.
Sweepstakes operators, like skill games and fantasy sports in some states, are unregulated but operate on a model that they believe is compliant with sweepstakes laws in the U.S. that allows for free-to-enter contests with real-money prizes. While sweepstakes casinos operate under these laws, these laws govern a wide range of endeavors, such as the McDonalds Monopoly game or promotional drawings run by companies.
Sweepstakes sites are generally available in most U.S. states, but operators tend to avoid Idaho, Michigan, Montana and Washington, where local laws impact the ability to operate.
Michigan sent a cease and desist to VGW last year which VGW complied with. SBC Americas recently learned that Deleware sent a similar letter to the company in December 2023 but that the operator is still live in the state.
Though there is heightened scrutiny around sweepstakes operators, the list of new sweeps sites keeps growing, including the launch this week of two operators that shuttered their regulated sportsbooks before moving to the sweepstakes vertical.
