Tribal Leaders Condemn Sweepstakes During Recent Meeting

The debate surrounding sweepstakes intensified over the last year. With some analysts estimating the cost of the market at tens of billions as of 2023, the niche sector is likely to keep growing. This places sweepstakes in the sights of lawmakers, gambling regulators and stakeholders such as commercial and tribal operators.

Sweepstakes at the Sights of Tribal Leaders

In one recent debate, Tribal leaders spoke about the impact of daily fantasy sports (DFS) and sweepstakes, criticizing the negative influence of those activities that affect not only Tribal but commercial gaming too. Held online via Zoom, the debate included Victor Rocha, the conference chair of the Indian Gaming Association (IGA), James Siva, the chairman of the California Nations Indian Gaming Association (CNIGA) and Jason Giles, executive director of the IGA.

Notably, Rocha was critical of the sweepstakes and DFS sector, warning that such operators do not pay taxes, are not regulated like the gambling sector and do not enforce policies such as know-your-customer (KYC). IGA’s conference chair deemed sweepstakes as “gambling on training wheels,” warning that lacking protection allows consumers to download such applications freely as long as they are 18 or older.

The Fight Against the Tribes and Sweepstakes Is Upcoming

For several years, betting operators waged war in California, pushing for the legalization of the activity. With the Tribes pushing back, the efforts of betting companies like FanDuel and DraftKings did not succeed. In that line of thought, Rocha predicted that the new fight would pit the Tribes and the commercial gambling sector with the sweepstakes vertical. Concerningly, he warned that the negative impact of DFS and sweepstakes do not only affect California and the Tribal gambling operators but represent a threat to the commercial sector too.

Recently, Flutter Entertainment’s chief executive officer, Peter Jackson, shared his opinion on tax hikes. He warned that draconian measures or increases in taxes may ultimately push customers to illegal gambling operators or sweepstakes providers.

Similar to Rocha, Siva also spoke about the Tribes’ fight with betting operators in California. He explained that every new gambling activity in the state “begins and ends with Tribes.” Moreover, Siva added: “We will defend our sovereignty every day of the week.”

In contrast to the Tribal leaders’ views, during the inaugural briefing of the Social and Promotional Gaming Association (SPGA), experts argued about the misinformation when it comes to sweepstakes and some unfounded concerns. During the briefing, Clubs Poker’s CEO, John Kaplowitz, claimed that his social casino platform enforces not only KYC, but also has established policies related to anti-money laundering and responsible gambling.

Undoubtedly, the devil hides in the details so the debate on sweepstakes will continue. It is yet to be seen if states would deal with sweepstakes operators on a local level or if rules may be enforced by lawmakers on a federal level.