California Governor Gavin Newsom has signed a bill outlawing sweepstakes casinos, marking a major blow to the industry in the nation’s most populous state.
The new law, AB 831, was signed on Saturday and will take effect January 1. The bill faced no opposition as it moved through the California legislature.
The legislation, strongly supported by the California Nations Indian Gaming Association (CNIGA), argued that sweepstakes casinos violated tribal gaming exclusivity rights in the state.
A Major Defeat for Sweepstakes Operators
California’s move represents not only the latest setback for sweepstakes casino operators but also their most significant loss yet. With more than 39 million residents, California is the largest U.S. state to ban such platforms.
Previously, New York—the fourth-largest state—passed a similar bill that now awaits Governor Kathy Hochul’s signature. In contrast, a comparable effort in Florida, the third-largest state, failed to pass earlier this year.
Industry Pleads for a Veto
The Social Gaming Leadership Alliance (SGLA) urged Governor Newsom to veto AB 831, arguing that the law would harm both the economy and innovation.
Citing a Seven Letter Insight survey, the group claimed that 85% of Californians supported regulating and taxing sweepstakes casinos instead of banning them.
“It is incredibly disappointing that the California Assembly decided to pass AB 831,” said Jeff Duncan, Executive Director of SGLA. “This bill will worsen economic disparities among tribes, hinder digital innovation, and remove a popular form of entertainment. It will immediately strip $1 billion from California’s economy.”
He added, “We implore Governor Newsom to reconsider and instead create a framework to regulate online social gaming, supporting tribal nations and boosting the state’s economy through next-generation gaming technology.”