Connecticut Bill Banning Sweepstakes Passes Final Stage
Connecticut lawmakers have taken a significant step in reshaping the state’s gambling landscape by voting overwhelmingly in favor of a bill aimed at banning sweepstakes casinos. With the Connecticut House of Representatives passing Senate Bill 1235 with a unanimous vote of 146-0, the legislation is now poised for final approval by Governor Ned Lamont. If enacted, the bill will take effect on October 1, 2023.
The Connecticut Senate also supported the bill in a 36-0 vote on May 23, demonstrating a remarkable level of bipartisan agreement. Given the strong support from both chambers, it is widely anticipated that Governor Lamont will endorse the legislation.
Key Provisions of the Legislation
The core of this bill is a prohibition on individuals and companies from conducting or promoting any “sweepstakes or promotional drawing” that employs a simulated gambling device or encompasses any real or simulated online casino gaming and sports wagering. This regulatory change characterizes operating an illegal gambling business as a Class D felony, carrying potential penalties of up to five years in prison and a $5,000 fine.
As these developments unfolded, many sweepstakes casinos have preemptively exited Connecticut. Notably, VGW ceased operations last year, and Stake followed suit in February of this year, shortly after the bill was introduced.
The legislation also includes a nuanced exception permitting businesses to conduct sweepstakes-style promotions related to grocery sales, provided that prizes are not redeemable for cash and solely reduce the price of items from the grocery chain.
A Nationwide Trend
Connecticut is not alone in grappling with the rise of unregulated casino platforms. With estimates indicating that sweepstakes casinos generated approximately $67 billion in revenue in the preceding year, several states are enacting or considering similar bans. Montana has already legislated against sweepstakes casinos, while Louisiana is on the cusp of doing the same.
Support from Regulatory Bodies and Tribal Interests
The Connecticut Department of Consumer Protection (DCP) has expressed strong support for SB 1235. DCP Commissioner Bryan Cafferelli commented that the legislation “will benefit the department by improving our regulatory oversight of the gaming industry.”
Additionally, the Mohegan Tribe has played a pivotal role in shaping this legislation, advocating for regulated gambling practices that protect their interests. Online casinos in Connecticut operate legally through the Mohegan Tribe and the Mashantucket Pequot Tribal Nation, in collaboration with major platforms like FanDuel and DraftKings.
Since the legalization of online gambling in Connecticut in 2021, revenue growth has been notable, as shown in the table below:
| Fiscal Year | Online Casino Revenue (GGR) | Tax Collected (18%) |
|---|---|---|
| 2021-2022 | $176.8 million | $31.8 million |
| 2022-2023 | $232.5 million | $41.9 million |
| 2023-2024 (Projected) | $275.0 million | $49.5 million |
| Total | $684.3 million | $123.2 million |
Connecticut imposes an 18% tax on online casino gross gaming revenue, which is set to increase to 20% in 2026, further solidifying its position in the revenue-generating gaming sector.
Additional Regulatory Changes
In addition to the ban on sweepstakes casinos, the bill will also restrict state lottery couriers from operating, aligning Connecticut with other states like Florida and California that have enacted similar bans on third-party lottery sales. Texas is also looking to impose a ban in the wake of their ongoing lottery controversy.
Furthermore, the legislation introduces several measures aimed at enhancing regulatory compliance among gambling companies. These include increased confidentiality in criminal background checks, greater transparency in record-keeping, restrictive advertising practices, and various administrative reforms.
Conclusion
The passage of SB 1235 marks a pivotal moment in Connecticut’s gambling regulations. With the ongoing evolution of the betting landscape and the substantial financial implications associated with illegal gaming, this legislative effort signifies a commitment to a more organized, safer gambling environment. As states across the nation navigate the challenges posed by unregulated platforms, Connecticut’s proactive stance may serve as a model for others seeking to balance industry growth with consumer protection and responsible gaming practices.
About the Author
Adam Roarty is an experienced writer with over five years of expertise in the gambling industry. His work spans platforms like Oddschecker, CoinTelegraph, and Gambling Industry News, where he has honed his insights into sports betting and online gambling. Adam is dedicated to exploring the rapidly changing landscape of betting in the U.S., examining emerging trends, legislative shifts, and the impact of new market entrants on the industry.
