Sweepstakes casinos are in the crosshairs of Louisiana lawmakers after a pair of House Bills were filed ahead of the legislative session.
They would revamp current laws on online gambling and broaden enforcement authority to target not only sweepstakes operators but also the companies that support their operations.
Louisiana joins list of states to ban sweepstakes casinos
House Bill 883, sponsored by Rep. Laurie Schlegel, would redefine illegal online gambling to cover dual-currency systems that allow players to exchange credits for cash or prizes while simulating casino-style play.
The proposal does not mention “sweepstakes” by name but instead focuses on the business model. Sweepstakes platforms typically offer virtual Gold Coins with no cash value and Sweeps Coins that can be redeemed for money, a structure regulators argue brings them within gambling law.
The bill comes after most major sweepstakes operators left Louisiana in 2025 following cease-and-desist letters from the Louisiana Gaming Control Board. Lawmakers say the updated language would close perceived loopholes and strengthen enforcement authority.
A second measure, House Bill 53 by Rep. Bryan Fontenot, would classify certain gambling offenses, including gambling by computer and electronic sweepstakes devices, as racketeering crimes.
Fines to increase and possible prison sentences for infractions
If House Bill 883 is approved, the legislation would sharply increase penalties for illegal sweepstakes operations. The maximum fine would rise from $20,000 to $100,000, while prison sentences would remain capped at five years.
Anyone who knowingly assists the activity, including payment processors or hosting providers, would be liable Penalties would double if a person under 21 is involved.
Each wager would count as a separate violation, and every related promotion would be treated as its own offense. Courts would be required to order forfeiture of profits tied to violations, compounding the financial consequences.
The bill also empowers the attorney general and Gaming Control Board chairman to issue cease-and-desist orders, with 10 days to comply. Companies that ignore notices could face additional penalties, and listed operators would be presumed aware of the alleged illegal conduct.
Louisiana’s aggressive perusal of sweepstakes casinos
Last year, Louisiana filed lawsuits against sweepstakes operators VGW and WOW Vegas, seeking more than $44 million in unpaid sales taxes. The state is pursuing about $32.5 million from VGW and roughly $13.6 million from WOW Vegas, alleging they failed to collect and remit taxes on virtual currency sales.
The action followed cease-and-desist letters issued by the Louisiana Gaming Control Board to 41 companies accused of unlicensed gambling. The Department of Revenue argued that purchases of virtual currencies such as Gold Coins qualify as taxable retail sales under state law.
Officials say the lawsuits signal a broader enforcement push, with additional cases possible as regulators seek to recover unpaid taxes. VGW has since begun applying sales taxes to certain purchases, notifying customers that rates vary by state.
The company faces mounting legal pressure across North America, having exited several U.S. states and announcing plans to withdraw from Canada. Even in jurisdictions where it no longer operates, including Louisiana, VGW continues to confront regulatory and tax disputes.
In July last year, Louisiana Attorney General, Liz Murrill, gave a legal opinion that dual-currency platforms are a violation of state law. She said: ““Following a review of applicable Louisiana statutes and legal precedent, it is the opinion of this office that online businesses offering casino-style games, purporting to be sweepstakes or social gaming platforms, are operating in violation of Louisiana law. These activities constitute illegal gambling and illegal gambling by computer under multiple provisions.”
