Tennessee Bans Sweepstakes Casinos, Cites Consumer Protection
Tennessee has banned sweepstakes casinos after a long-debated bill became law.
Gov. Bill Lee signed HB 1885/SB 2136 just a month after the state legislature passed the bill.
It is now illegal to access sweepstakes casinos, a source of controversy in a state that does not regulate online casino sites.
At a Glance:
- Sweepstakes casino ban passed on May 22
- Dual-currency casinos now prohibited from within TN borders
- Bill had been defeated by the House just weeks earlier before a U-turn
Governor leaves it late to pull the plug on sweepstakes
The original bills on sweepstakes casinos — HB 1885/SB 2136 — only passed the state legislature as the session ended in April.
The Tennessee governor waited until the last minute to sign the bills into law. However, given his opposition to online casinos, this was to be expected.
The Volunteer State now treats violations of the law the same as violations of the Consumer Protection Act. It is now illegal to access or play at sweepstakes casinos from anywhere in Tennessee.
Sweepstakes casinos vs. real-money gambling sites
Sweepstakes casino sites differ from online casinos in the way they offer prizes. Online casinos let you bet on slots or table games with U.S. dollars. They are only legal and regulated in a handful of states.
Sweepstakes casinos are free to play. However, you can also purchase virtual coins to play slots and table games.
Most sweepstakes casinos, like LoneStar, offer a dual-currency system. They bundle free-to-play coins with special Sweeps Coins. It’s those you can redeem for real cash that have provoked the rage of states like Tennessee.
Tennessee joins wave of states prohibiting sweeps casinos
By banning sweepstakes casinos, Tennessee joins a list of states that have introduced similar bans.
Louisiana and Minnesota are among the states that don’t currently regulate online casino games of any kind.
However, the ban extends to states like New Jersey and Connecticut that are keen to protect their regulated industries. A key point in their objections is that unregulated casino sites do not pay any tax in those states.
‘Cease-and-desist’ and location blockers control sweeps activity
Other states, such as Illinois, have issued cease-and-desist letters to sites, including MegaBonanza, demanding that they stop offering products. Many sweepstakes casinos have not closed shop entirely.
However, they have introduced blocks on residents from certain states accessing their platforms. MegaBonanza now has a mobile verification system for customers in the U.S. You will be denied access if you live in a prohibited state.
Until a federal ruling or individual state laws are passed, sweepstakes casinos continue to operate largely on U.S. soil.
