(MENAFN)

California has taken decisive action to curb the rise of sweepstakes-style gambling platforms that imitate traditional casino games. Assembly Bill 831 (AB 831) aims to prohibit unlicensed sweepstakes casinos that use dual-currency systems, closing a loophole that has allowed these operators to function outside established gambling laws.

As the state moves to regulate these platforms more strictly, some players turn to alternatives such as offshore casinos, thoroughly reviewed by the Pokerscout team for their entry bonuses, flexible access, and game variety. These provide regulated and legitimate options outside increasingly strict U.S. gambling laws, particularly in California where gambling is mainly constrained to tribal casinos. This push for an even stricter oversight ties directly to broader economic and legal concerns.

The financial implications of the proposal in question, as a small part of the overall gambling framework in the United States, is clear. According to the American Gaming Association’s State of the States report, the U.S. commercial gaming industry generated a record-breaking $72 billion in revenue in 2024. This figure clearly underlines the forces driving regulatory efforts like California’s AB 831 bill. Protecting this revenue stream remains a priority for state governments that rely on gaming taxes for public funding.

In line with the efforts and the bill narrative, in a press release dated June 24, Assembly member Avelino Valencia, author of the bill, said AB 831 closes loopholes in legal gray areas, protects the voter-approved framework upholding tribal governments’ sovereign gaming rights in California, and ensures gaming in the state remains fair and accountable. His remarks emphasize the need to preserve tribal sovereignty while addressing emerging gambling platforms.

The bill’s focus on protecting tribal rights reflects the significant economic role tribal casinos hold in California. According to the reports these establishments are known to generate up to $11 billion annually, as it was the case in 2022. They support thousands of jobs and contribute billions in tax revenue to the state. These casinos operate under exclusive compacts that grant sole rights to offer gambling within California. Because of this status, tribal leaders back AB 831 as a measure to protect their economic interests. Meanwhile, sweepstakes casinos exploit regulatory loopholes by using virtual currencies redeemable for cash, operating outside the established legal framework.

The bill passed the Senate Public Safety Committee by a 6-1 vote and now moves forward for additional consideration. It calls for misdemeanor charges against operators of unlicensed sweepstakes casinos, carrying fines ranging from $1,000 to $25,000 and potential county jail time up to one year, or both. Advocates contend these penalties will shield consumers from exploitative practices and protect revenues meant for licensed gaming establishments.

Opponents of the bill argue that criminalizing existing business would not be the best solution since taxing this industry, according to Bill Gantz, speaking in the name of Social Gaming Leadership Alliance, could bring about $150 million of sales tax revenue annually.

As the legislative process progresses, stakeholders on both sides will continue to advocate for their positions, and the outcome of the upcoming Appropriations Committee hearing will be pivotal in determining the bill's future.

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