AB 831 Advances in California Senate, Threatening Sweepstakes Gaming
AB 831 Moves Forward in California Legislature
The controversial AB 831 bill has successfully passed the California Senate, despite strong opposition from tribal groups and businesses in the sweepstakes gaming sector. Although it still requires several more approvals before becoming law, those against the bill are already preparing for its potential impact.
Understanding AB 831 and Its Impact on Sweepstakes Gaming
AB 831 aims to dismantle California’s growing social gaming industry, commonly known as sweepstakes. This industry operates on a dual-currency model, allowing players the option to participate for free or wager money. Because players can win prizes without risking real money, these games have been argued by operators to fall outside traditional gambling laws.
Nonetheless, the expansion of sweepstakes gaming has triggered significant pushback. Various states have ordered leading social casino companies to halt their operations, and lawmakers have introduced legislation targeting these games with varying degrees of success.
Having passed the Senate, AB 831 now returns to the California Assembly for further examination and possible amendments. If it clears the Assembly’s Governmental Committee and a full floor vote, the bill would become law, effectively shutting down the sweepstakes industry in California.
The bill not only targets operators but also threatens penalties against technology suppliers, payment processors, and marketing agencies that support sweepstakes games. As a result, some providers have already withdrawn from the market in California.
Opposition From Tribes and Industry Stakeholders
Industry groups and several Native American tribes have voiced strong opposition to AB 831. Representative tribes such as the Sherwood Valley Band of Pomo Indians, Mechoopda Indian Tribe of Chico Rancheria, Big Lagoon Rancheria, and the Kletsel Economic Development Authority argue that the legislation disproportionately harms smaller tribes while favoring large casino interests.
Despite these protests, opposition efforts have not significantly stalled the bill’s progress. Moreover, sweepstakes operators are facing increasing legal challenges. For example, the Los Angeles City Attorney has filed a lawsuit against Stake.us, the sweepstakes division of the well-known crypto casino Stake.com.
The lawsuit seeks to compel Stake.us to cease operations and refund all player losses. It also accuses suppliers such as Evolution, Pragmatic Play, and Hacksaw Gaming of facilitating an allegedly illegal gaming service.
