The American Gaming Association has called for more regulation of sweepstake casinos, emphasising that their rise presents a myriad of risks for the sector.
In a piece published on the Vixio Regulatory Intelligence, the body drew attention to the fact that sweepstake casinos are incredibly similar to that of regular casinos. However, in most circumstances these firms operate under a far less intense regulatory environment.
According to the AGA, sweepstakes avoid regulations and licensing through a dual-currency system, however they do still ‘look and play like an online casino’. It warned that ‘the ‘opaque nature’ could also significantly elevate the risk of bad actors having an opportunity for illegal activity.
The AGA stated: “The lack of regulatory oversight presents many risks for consumers as well as the integrity and economic benefits of the legal gaming market through investment and tax contributions. These sweepstakes-based operators have weak (if any) responsible gaming protocols and few, if any, self-exclusion processes.”
The comments from the AGA intensified pressure on the sweepstake sector after numerous lawsuits placed against Virtual Gaming Worlds, which owns popular sweepstake sites Chumba Casino, Lucklyand and Global Poker.
Nonetheless, in its latest interim update, Catena Media underlined its anticipation that the sector will continue to evolve and grow.
Catena Media CEO, Manuel Stan, revealed his belief that sweepstakes are the fastest growing vertical for the firm and he believes that they ‘are very well positioned to capitalise on that growth’ of the industry.
He added: “Our products are focused on growing the sweeps vertical. I think it’s twofold. Right now, we see that generally overall in the industry being one of the fastest-growing verticals and we capitalise on it.
“But also, we position ourselves for post-regulation in the bigger states in the US, where we will be able to have built our databases around our brands to capitalise when the likes of California and Texas will be regulating.”
