Shortly after publishing we learned VGW would be pulling out of Mississippi in a similar fashion: no more SC-play, but GC-play remains. The timeline for MS players is slightly different from the one for NJ:
- July 31: No more SC can be obtained by any method. Postal request codes no longer available.
- August 14: No longer able to play with SC. Postal requests will no longer be processed.
- September 4: No longer able to redeem SC.
Virtual Gaming Worlds (VGW) is removing Sweeps Coins (SC) play in another state: this time New Jersey.
This will affect its whole roster of sweepstakes casinos, namely Chumba Casino, LuckyLand Slots, and Global Poker.
Starting July 29, players can’t earn Sweeps Coins in any way or generate postal codes for AMOE, but they can use existing SCs. From August 26, Sweeps Coins won’t be accepted for play or mail requests, though redemptions will remain. Then from September 24, all Sweeps Coin redemptions end, closing VGW’s sweepstakes in New Jersey.
The news comes less than a month after VGW did the same in Louisiana, likely in response to the Louisiana Gaming Control Board (LGCB) issuing cease and desist letters to various sweepstakes operators. That action came after the Louisiana legislature passed an anti-sweeps bill, although it was eventually vetoed by Governor Jeff Landry.
Why Is VGW Exiting the New Jersey Sweepstakes Market?
Back in New Jersey, it’s a similar story, with anti-sweeps proposal, A5447 having passed at the end of last month.
This bill amends current NJ gambling law to specifically outlaw the sweepstakes vertical and, if signed off by Governor Phil Murphy, will take effect immediately, perhaps explaining why VGW have decided to pull out even before its signing.
It is a little unusual that Governor Murphy still hasn’t signed off on A5447, especially given that the bill passed both chambers with wide margins nearly a month ago. According to the New Jersey legislative record, it hasn’t yet been transmitted to the governor’s desk, meaning the standard 45-day countdown for gubernatorial action hasn’t even begun.
To be honest, it’s a similar situation in New York, where the S5935 bill hangs in the air (VGW has also pulled out of SC-play in NY).
What Does New Jersey Bill A5447 Mean for Sweepstakes Operators?
A5447 explicitly bans sweepstakes gaming where participants pay or offer “something of value” in exchange for a chance to win a prize. In terms of punishments, violations could incur fines of up to $250,000 per day, making A5447 one of the most financially powerful measures targeting sweepstakes operators to date.
Other smaller sweepstakes casinos have made the same move, withdrawing from the Garden State in recent weeks. This list includes Lucky Slots, Clubs Casino, Clubs Poker, Vivaro, Funzpoints, SweepNext, Baba, and Sixty6.
However, VGW is not beating a full retreat – it’s adding New Jersey to its list of states where free play with Gold Coins is still possible. That makes it the fourth state where this applies, alongside Idaho, New York, and Louisiana.
This essentially means that VGW’s brands function as pure social casinos in these jurisdictions; not offering play for Sweeps Coins and cash redemptions, but allowing play with Gold Coins. Players can still purchase Gold Coins if they like too.
VGW and Laurence Escalante Also Facing Battles Elsewhere
It comes as the fight for the giant California market rages on, with the AB831 anti-sweeps bill making gradual progress there, backed by the Californian tribes and traditional casino interests. VGW has been active in campaigning against that proposal as part of the Social Gaming Leadership Alliance, but the bill still stands a good chance of succeeding.
VGW owner, Laurence Escalante has also been in talks with shareholders in recent months to wrest full control of the company. One of the reasons cited for this being necessary is the rapidly developing legal landscape in the US, requiring increased ease of maneuvering.
With New Jersey now joining the growing list of blocked states, VGW’s retreat from promotional gaming there reminds us how the regulatory seas have never been choppier, and sweeps operators are having to deftly navigate these waters.
Escalante and Chumba Casino were the original innovators of the online sweepstakes casino back in 2012, and so their movements are closely followed by the rest of the industry.
While some operators are choosing to exit markets like NJ entirely, VGW’s pivot to a social-only model in some states shows a willingness to adapt. Maybe competitors will choose to copy this idea, which remains relatively unpopular for now. It’s likely they’re waiting to understand the long-term viability of this model, which is still unclear.
Author: Alex Windsor
Updated:
