AB 831 Signed: California Bans Online Sweepstakes Casinos

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AB 831 Signed: California Bans Online Sweepstakes Casinos

California Governor Gavin Newsom has officially signed AB 831 into law, making it illegal to operate or promote online sweepstakes casinos in the state. The new statute takes aim at digital platforms that use a “dual-currency” model to mimic casino wagering under the guise of sweepstakes. 

Under the law, anyone who operates, conducts, offers, or promotes a covered online sweepstakes game may face misdemeanor charges. 

Moreover, the law extends liability to supporting entities such as payment processors, platform providers, geolocation services, media affiliates, and other indirect actors. 

What AB 831 Becoming Law Means for California Online Sweepstakes Casinos

With AB 831 now in effect, online sweepstakes casinos in California must cease operations or risk prosecution. The law explicitly criminalizes their core business model. Entities that had served merely as facilitators or promoters will also be vulnerable. 

The new law closes legal loopholes that these platforms exploited by claiming they were sweepstakes, not gambling. It redefines “gambling-themed games” to include slots, table games, bingo, lottery, and simulated wagering tied to cash or prize payouts. 

In addition, the law preserves carve-outs for sweepstakes that do not award cash or cash equivalents, thereby exempting legitimate promotional campaigns by brands. The maximum penalty caps at a fine up to $25,000 and/or up to one year in county jail. 

Tribal gaming interests view the law as protection of their constitutional and compact-based exclusivity over gambling. 

Reception from Lawmakers, Supporters, and Detractors

Supporters, including tribal governments and the California Nations Indian Gaming Association, hailed the bill as necessary to safeguard regulated gaming integrity. Tribal supporters argued that sweepstakes casinos undermine voter-approved gaming law and revenue flows. 

Assemblymember Avelino Valencia, the bill’s author, said these platforms exploited legal loopholes and undermined California’s regulated gaming system.

But critics from the sweepstakes industry say AB 831 overreaches. The Social and Promotional Games Association and the Social Gaming Leadership Alliance warned that the law could harm legitimate digital promotions. They also argued it could expand criminal liability beyond operators.

Some detractors also fault the legislative process, calling the amendment last-minute and lacking public debate. 

In response, some sweepstakes platforms have already mobilized their customer bases in California to urge legislators to reconsider. 

As AB 831 becomes law, legal challenges are expected, and the reshaping of California’s digital gaming landscape has officially begun.

That said, with the end of Sweepstakes in The Golden State, players are expected to move to normal online casinos.