Montana Online Sweepstakes Gaming Ban Waiting for Governor's Signature
Montana is on the verge of becoming the first U.S. state to enact legislation directly targeting sweepstakes casinos, pending a final decision by Governor Greg Gianforte. Senate Bill 555 (SB555) has cleared both the state House and Senate and now awaits the governor's signature.
Key Takeaways
- Montana may become first U.S. state to ban sweepstakes casinos with SB555 legislation
- Bill targets online platforms using any currency and offering cash payouts through casino-style games
- Legal ambiguity remains around non-cashable currencies used in purely social or freemium casino apps
The bill amends Montana's existing gambling statutes to specifically define and criminalize illegal internet gambling. The bill includes language that appears to directly target the model used by sweepstakes casino operators.
The bill has a provision that reads, "Internet gambling includes online casinos, by whatever name known, which constitute internet gambling and therefore are prohibited."
The broad language of the bill is meant to encompass the online casino websites that have exploited loopholes in the law to continue operating.
Sweepstakes casinos typically operate on a double-currency model. Gamers are able to purchase a base currency, which is typically referred to as Gold Coins, and play games for entertainment purposes.
Each time they make a purchase, players get a promotional currency, which is typically referred to as Sweeps Coins, to play sweepstakes-type games that award additional Sweeps Coins.
Operators argue that since gamblers do not pay directly to place bets for money and are provided with free Sweeps Coins, the system is not gambling under current definitions.
SB555 appears to contradict this interpretation by highlighting platforms that entail the acceptance of "any form of currency" for wagering and that provide for cash payouts. This would place the Sweeps Coin model squarely within the bill's grasp. But there remains ambiguity.
SB555 appears to contradict this interpretation by highlighting platforms that entail the acceptance of "any form of currency"