Editor
New Jersey legislators passed a ban on sweepstakes poker and casinos this week, but the Social Gaming Leadership Alliance (SGLA) is calling on Governor Phil Murphy to veto it. Intervention by the governor would be the last hope for sweepstakes poker sites to continue serving New Jerseyans. That includes Global Poker, operated by Virtual Gaming Worlds (VGW), which holds a leadership role in the SGLA.
The Social Gaming Leadership Alliance is the primary organization advocating for the veto. Jeff Duncan, Executive Director of the SGLA, says that prohibiting, rather than regulating, sweeps is “the wrong solution to a misunderstood issue.”
The sweepstakes industry has two trade organizations that are making separate efforts to reverse the trend of states prohibiting the business model. However, there is some disconnect between the two organizations. The first, the Social and Promotional Gaming Association (SPGA), appeared last year, but notably didn’t count VGW among its members. That raised eyebrows, as VGW is the industry leader with brands like Chumba Casino and Luckyland Slots.
When VGW founded the SGLA this year, that organization’s charter provided clues as to why VGW might have decided to sit out the SPGA. The SGLA adamantly excludes sports-based sweepstakes products, such as Fliff, and insists on specific policies for its members, including strict age verification. Some sweeps sites still allow users 18+, but VGW changed its age limit to 21+ in February. It may be the case that VGW considers some SPGA members to be on shakier legal ground than itself and doesn’t want to connect its brands to theirs.
Can VGW Succeed Where WPT Failed?
The appeal resembles another last-ditch effort made by WPT CEO Adam Pliska. He flew to New Jersey to speak against the prohibition before the final vote in the legislature. He told lawmakers, to no avail, that WPT has invested considerably in compliance and its desire to be a good corporate citizen.
Proponents of the bill had some strong words against sweepstakes gambling, most notably from state Senator John Burzichelli.
They’re exploiting a loophole, and the loophole is clear: Sweepstakes masquerading as gambling is illegal.
State Senator Paul Sarlo added that sweepstakes gambling “takes away revenue from those who are highly regulated.”
Although numerous states have taken steps to block sweepstakes-model sites in one way or another, those with regulated online casinos have been among the most aggressive. To some extent, the pushback on sweeps comes from the American Gaming Association, which represents regulated US gambling interests and sees the sweepstakes model as a threat on par with offshore gambling.
Image Credit: Gov. Phil Murphy via Flickr (license)
