Summary
- Louisiana is the newest state to challenge the sweepstake social casinos model.
- A trade association cautions against the potential unintended consequences of implementing this law.
- The new bill has been criticized for being 'economically and culturally insensitive.'
Louisiana has become one of the increasing number of states attempting to curb sweepstakes by labeling them as illegal gambling. While similar bans in states like Mississippi have failed, primarily because they unsuccessfully combined with sports betting regulations, the opposition to the sweepstakes industry persists.
Louisiana bill seeks to ‘criminalize loyalty programs’
Senator Adam Bass of Louisiana has introduced Senate Bill 181, aiming to officially classify a certain activity as unregulated gambling, which he believes should be curtailed. However, the Social and Promotional Games Association (SPGA) has criticized this move, calling it a reckless classification. Over the weekend, the SPGA swiftly responded, warning Senator Bass about the potential negative impact of the bill's passage, suggesting it poses a threat to the state's tech industry. They emphasized a long-standing argument: for decades, companies like fast-food chains and app developers have employed this mechanism without facing opposition. The SPGA contends that the well-established no purchase necessary guidelines should prevent a ban under new state law, which may overreach and harm more than one sector. Additionally, the association argues that SB 181 could inadvertently criminalize loyalty programs, creating turmoil by potentially categorizing them under the sweepstake definition and leading to their prosecution as illegal.
Tone and economically-deaf proposal, argues the SPGA
According to the association, SB181 is considered both culturally and economically insensitive. They highlight evidence showing that many people have enjoyed sweepstake casinos for years and that this model is largely regarded as legal throughout most of the country. The SPGA further warns that SB181 may deter venture capital investment, potentially hindering the development of new technological advancements from the state, including critical technologies like artificial intelligence. Essentially, SB181 is seen as antagonistic to business and innovation, as well as to consumers who have embraced the sweepstakes social casino model. The association believes state legislators should oppose and halt what the SPGA describes as an ill-conceived bill. They advocate for more expert input before making any legal changes. In March, Arkansas introduced a draft law aiming to ban sweepstakes operators by classifying them as illegal gambling.
