New York Attorney General Shuts Down 26 Sweepstakes Casinos
In a significant move that’s set to ripple across the American online gaming space, the New York Attorney General's Office, working in tandem with the New York State Gaming Commission, has shut down 26 online sweepstakes casinos. The platforms, which include well-known names like Chumba, Global Poker, Luckyland, Fliff, TaoFortune, and Zula Casino, have ceased offering sweepstakes coins to New York residents following a series of cease-and-desist letters issued on June 6.
The decision comes amid a broader push for clarity around gaming regulation in the U.S., especially in states like New York that are actively defining the line between skill-based gaming, sweepstakes models, and licensed online gambling.
Understanding the Issue
At the center of the action is the sweepstakes model, where platforms offer both free and paid currencies. While the games themselves often resemble those found in online casinos, slots, table games, and even sports betting, the sweepstakes system functions differently. Players typically use virtual coins to play, which can sometimes be exchanged for real cash or prizes depending on the terms of service and the jurisdiction in which they’re playing. Similarly to Pachinko, they're a way to circumvent gambling rules, as you can’t win money directly, but play with tokens that can be exchanged for real prizes.
New York law considers any system where something of value (including digital currencies with cashout potential) is risked for the chance of reward to fall under its gambling statutes. Since these platforms were operating without a state-issued license, they were deemed to be in violation of local regulations.
Industry Pushback
However, the move hasn’t gone unchallenged. Industry advocates, including the Social and Promotional Games Association (SPGA), have voiced concern over what they describe as a mischaracterization of legally compliant platforms. The SPGA asserts that many of its member companies operate entirely within federal guidelines, meet tax obligations, and voluntarily implement responsible gaming standards.
According to the association, sweepstakes-based platforms, especially those offering free-to-play options that don’t require purchases, remain lawful in the vast majority of U.S. states, including New York. The group expressed frustration that prior efforts to open a dialogue with New York officials were unsuccessful, describing the enforcement as broad and lacking nuance.
From the SPGA’s perspective, enforcement should differentiate between bad actors and platforms that comply with existing laws but operate in a regulatory gray area. They argue that sweeping actions like this risk suppressing innovation and may ultimately limit consumer choice without resolving the core legal ambiguities.
Why It Matters
This development reflects a broader trend among U.S. regulators to reexamine sweepstakes gaming. Earlier in 2025, several companies preemptively exited states such as Michigan and Washington due to changing legal interpretations and increased scrutiny. In New York’s case, legislation is already being considered that could explicitly define and regulate sweepstakes models, while enhancing enforcement powers for state gaming authorities.
New Yorkers who previously played on these platforms are now encouraged to explore licensed, state-regulated alternatives. These options offer many of the same features—slots, poker, and table games—but with additional protections such as deposit limits, age verification, and access to responsible gaming resources.
The New York State Gaming Commission recommends that players looking for real-money gambling experiences use regulated services that meet the state’s legal and operational standards. This ensures fair play, secure transactions, and access to assistance if needed.
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