The New York Senate has amended a bill that would prohibit online sweepstakes to clarify that the state’s gambling regulator would get to define what is or isn’t a “dual-currency system.”
Sen. Joseph Addabbo’s SB5935, which has a partner bill in the Assembly, defines an online sweepstakes as an online game, contest or promotion that, “utilizes a dual-currency system of payment allowing the player to exchange the currency for any cash price, cash award or cash equivalents.”
Such offerings, says the bill, simulate casino-style gaming, lottery games, bingo or sports betting, including the likes of slots, blackjack, roulette, craps, poker, draw games, instant win games and Keno.
An amendment made to the bill at third reading last week clarifies that the New York State Gaming Commission will be the group that determines what sites do and not qualify as a dual-currency system.
That new provision has replaced initial language that had stipulated that the definition of online sweeps, “shall not include a game which does not award cash prizes or cash equivalents.” That line has been removed.
The change, which reallocates the responsibility for defining what constitutes a dual-currency system from the legislation itself to the regulator, brings the Senate bill’s language in line with that of Assemblywoman Carrie Woerner’s A6745, which is making progress through the committee stage.
SPGA acknowledges Starbucks issue but says amendment fixes nothing
Opponents of anti-sweeps bills, versions of which have been filed in several states this year, have argued that such prohibitions could hurt small business and would unfairly criminalize promotional sweepstakes and marketing tools such as McDonald’s or Starbucks‘ rewards programs.
In Louisiana, for instance, where a sweeps ban was unanimously passed by the Senate last week, sponsor Sen. Adam Bass addressed this rhetoric.
“Regardless of what you’ve heard, this bill does not affect legitimate promotions, such as McDonald’s Monopoly, Starbucks or Marriott rewards,” he told the chamber. “This bill narrowly defines sweepstakes casinos. We know the gaming control board and attorney general have no interest in going after Starbucks or Marriott or McDonald’s and are solely focused on putting an end to sweepstakes casinos in this state.”
The Social and Promotional Games Association (SPGA), a vocal dissenter comprising several online gaming operators such as High 5 Entertainment, Blazesoft and Fliff, acknowledged that the New York language change is “a direct response to widespread concerns” but criticized it as “a political patch meant to quiet critics without solving the underlying problem”.
“This amendment is a clear acknowledgment that this anti-business bill needlessly threatens New York’s economy,” said a spokesperson for SPGA in a statement. “But this amendment doesn’t fix anything…
“Lawmakers wouldn’t be amending the bill if it didn’t need amending. New York legislators are publicly admitting the bill was flawed, and other states like Louisiana should take note before making the same mistake. This was already bad legislation. Lawmakers have taken a mess and made it into a catastrophe.”
Bills would target not only operators
In New York, as in some other states, the anti-sweeps push would target not only operators of the sites but also affiliated parties such as suppliers, payment processors, geolocation providers, gaming employees and investors.
New York’s gaming regulator, in conjunction with state police and the Attorney General’s office, would be empowered with the authority to conduct investigations and issue cease-and-desist orders to entities that fail to adhere to the bills.
New York’s legislative session adjourns June 12.
