We have previously posted on some of the recent legal issues with social casino sweepstakes. See Social Casino Sweepstakes Model is Under Fire – What Game Companies, Payment Processors and App Stores Need to Know. Various states have taken action to shut down these apps in their states. The NY AG, working with the New York State Gaming Commission, allegedly identified 26 online platforms offering players slots, table games, and sports betting using virtual coins that could be exchanged for cash and prizes. On June 6, the NY AG announced that it has stopped online sweepstakes casinos operating in New York. This action follows cease and desist letters to operators dating back to March 7, 2025.
According to the announcement, New York law prohibits online platforms from offering gambling that involves risking something of value, including virtual coins that can be redeemed for cash or prizes. It adds that most sweepstakes casinos are illegal in New York.