26 sweepstakes casinos have been closed by the State Gaming Commission and New York Attorney General Letitia James, who cited unlawful gambling practices and harm to the public caused by unregulated games that offered virtual coins that could be redeemed for cash.
New York Attorney General Letitia James revealed Friday that 26 cease-and-desist letters had been delivered to companies selling online casino sweepstakes games to state residents.
The statement acknowledged that a joint investigation by the Office of the Attorney General (OAG) and the New York State Gaming Commission (NYSGC) discovered 26 online gaming platforms offering slots, table games, and sports betting that use virtual coins that can be redeemed for cash prizes.
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While sweepstakes casinos have the option of playing with free coins that do not need to be purchased and cannot be redeemed, the majority of these sites allow, and even encourage, the purchase of virtual currency that can be redeemed for gift cards and cash. Because New York law prohibits online platforms from “offering gambling that involves risking something of value, including virtual coins that can be redeemed for cash prizes,” the OAG decided that sweepstakes casinos are prohibited in the state.
While sweepstakes casinos are not subject to the same auditing, licensing, and regulatory control as approved gaming platforms, the OAG expressed worries about games being manipulated and imposing gambling-related risk on the public.
“Online sweepstakes casinos are unlawful, harmful, and may devastate people financially.””I thank the New York State Gaming Commission and Senator Addabbo for working with my office to protect New Yorkers,” Attorney General James stated.
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