Montana is on the brink of becoming the first U.S. state to enact legislation targeting sweepstakes casinos, pending the signature of Governor Greg Gianforte. Senate Bill 555 received approval from both the state House and Senate.
Montana Senate Bill 555 Includes Payouts Of Any Form Of Currency
The bill amends Montana’s existing gambling statutes to specifically define and criminalize illegal internet gambling. The measure includes language that directly targets the model used by sweeps operators.
SB 555 has a provision that reads, “Internet gambling includes online casinos, by whatever name known, which constitute internet gambling and therefore are prohibited.”
The definition of “internet gambling” in SB 555 includes online casinos and platforms that offer casino-style games “that knowingly transmits or receives gambling information, allows consumers to place a bet or wager using any form of currency, and makes payouts of any form of currency.”
Online casinos that do not allow the use of currency of any kind are not considered a gambling activity and therefore are permitted. However, because sweepstakes casinos operate under a dual-currency model, they will be treated as illegal gambling operations for accepting real money.
Sweepstakes Casinos Use Their Own Form Of Currency
Although sweepstakes operators are not explicitly mentioned in the bill, they still use their own form of currency such as Gold Coins and Sweeps Coins. Players are then able to redeem their virtual coins to win real cash or prizes.
The words “any form of currency” could very well apply to virtual currencies. Some social casinos could be allowed to operate but only if the sites don’t utilize a dual-currency system.
Under SB 555, any person who purposely or knowingly operates an illegal gambling site(s) within the state’s borders would be guilty of a felony. Those convicted would also be subject to a max $50,000 fine and/or imprisonment for not more than 10 years for each violation.
Several sweepstakes casino operators had already left the Montana market before the passage of the legislation. Virtual Gaming Worlds (VGW), the parent company of Chumba Casino and Luckyland Slots, exited Montana in February 2024.