VGW and sweepstakes operators face an unprecedented crackdown across the US

Sweepstakes casino operators, including the Australia-based VGW Holdings, are facing a wave of regulatory and legislative crackdowns across the United States.

The past week has seen a series of enforcement actions and new laws targeting the dual-currency sweepstakes model, which allows users to play casino-style games and potentially redeem virtual winnings for cash or equivalents.

In Louisiana, the Gaming Control Board issued 40 cease-and-desist orders against offshore and sweepstakes sites, including a direct order to VGW.

Mississippi followed with 10 orders, specifically naming VGW’s Chumba Casino among the targeted platforms.

These actions come on the heels of a Louisiana legislative effort to ban sweepstakes casinos entirely, a bill that was ultimately vetoed by Governor Jeff Landry, who argued that regulators already have sufficient authority to police the industry.

Despite the veto, regulators have signaled a tough stance, emphasising the need to protect citizens and the integrity of the gaming sector.

New York has also moved decisively, with the Senate passing a bill to ban online sweepstakes casinos.

The legislation, which now awaits further approval, targets casino-style games that use virtual currencies convertible to cash, and includes penalties not only for operators but also for payment processors, software providers, and investors facilitating these platforms.

VGW, which operates Chumba Casino, LuckyLand Slots and Global Poker, has already announced plans to wind down its sweepstakes operations in New York, joining other operators like High 5 Casino and Funzpoints in exiting the state.

Other states are following suit. Connecticut, Montana and Nevada have all advanced or enacted legislation to restrict or ban sweepstakes casinos, with Montana’s law set to take effect in October 2025 and carrying penalties of up to 10 years in prison and $50,000 (€37,248) in fines for those that keep operating.

VGW has preemptively withdrawn from several of these states, including Delaware, Nevada, Connecticut and Montana, as enforcement ramps up.

Industry groups are divided in their response. The Social and Promotional Games Association, which does not represent VGW, praised Louisiana’s veto as a defense of innovation and legal clarity, while the Social Gaming Leadership Alliance, which includes VGW, called for a sensible licensing framework.

However, regulators in Louisiana described their enforcement as a ‘show of strength,’ warning that illegal operators will not be tolerated.

The rapid escalation of enforcement and new laws marks 2025 as a pivotal year for sweepstakes casinos, with VGW and its peers under more pressure than ever to navigate a shrinking and increasingly complex US market.