Up until this week, the opponents of sweepstakes gaming bans across the country have generally been sweepstakes operators and the two trade associations representing their interests, the Social and Promotional Games Association (SPGA) and the Social Gaming Leadership Alliance (SGLA).
However, the recent effort to prohibit sweepstakes in California is drawing some new opponents, including state card rooms and the American Civil Liberties Union (ACLU). While the former is amenable to a version of the bill that exempts them, the latter has major concerns about the bill’s impact on state residents.
ACLU worried individuals will be unfairly punished by broad language
ACLU California Action, the state chapter of the organization, posted its opposition to AB831, the bill designed to prohibit sweepstakes gaming operators, suppliers and influencers, on its website.
The Senate Public Safety Committee’s summary of the legislation offered the reasoning behind the ACLU’s stance:
“AB 831 would rachet up existing punishments for gambling. Penal Code Section 330 generally prohibits individuals from gambling, punishable by up to six months of incarceration and a $1000 fine. Because of how broadly AB 831’s language sweeps, prosecutors may argue that anyone who participates in an online sweepstakes is directly or indirectly supporting the gambling platform. In essence, AB 831 would double the term of incarceration and increase the maximum fine by 2500% for anyone engaging in online sweepstakes. As affirmed by the Federal Department of Justice, these increased punishments will not deter crime.”
The bill would criminalize not only operating a sweepstakes gambling site but supplying to or otherwise promoting one as well. A measure about suppliers passed in the New York version of the bill, which is pending Gov, Kathy Hochul’s signature, but did not include an influencer element.
Others question merit of misdemeanor provision
During a Senate Governmental Organization Committee meeting last week, lawmakers voiced similar concerns about the broad and rushed nature of the bill and potential unintended consequences. Despite those reservations, the committee passed the measure on to the Senate Public Safety Committee, which will hold a hearing on the measure on Tuesday.
Other opponents of the measure include the American Transaction Processors Coalition and the Association of National Advertisers. The former comprises a number of financial institutions including Fiserv, Bank of America and Paysafe.
The committee summary of AB831 also drew attention to the msidemeanor provision ACLU mentioned, questioning if there are already existing measures to address these issues and whether or not the federal Unlawful Internet Gambling Enforcement Act (UIGEA) covers this type of gambling. It went so far as to carefully question if the measure should remain in the bill or not:
“Should this misdemeanor offense, at the very least, be more narrowly focused to apply only to those operating or conducting online casinos? Should the language be amended to specify that the conduct must be knowing and purposeful (or willfully and knowingly)?”
On Tuesday, opponents of the bill will once again will be watching closely, as will proponents, which include a number of California tribes and the California Nations Indian Gaming Association (CNIGA) as well as the Sports Betting Alliance (SBA).
