Wallach Says Indiana’s Planned Sweepstakes Casino Ban Simply Brings State Gambling Laws Up to Date

Indiana is one of the states making a move against sweepstakes casinos early this year. Last January 6th, the House Public Policy Committee completed its initial hearing to open the debate on House Bill 1052. 

In addition to its sections focused on horse racing and sports wagering, HB 1042 defines and establishes civil and criminal penalties for operators of “sweepstakes game”. 

The bill’s hearing exposed divisions, and for one esteemed gaming lawyer, Indiana’s planned ban fits into the existing state’s gambling laws.

Daniel Wallach, a US betting attorney, explained that these gaming platforms “contravene the state’s prohibition against offering casino-style games”. He added that these rules are already reflected in the state’s case laws and have been affirmed by the Attorney General.

Indiana’s HB 1042 is Bad News for Sweeps Casino Operators, Say Wallach

In his recent Fortune article, which was shared on LinkedIn, Wallach offered some insights on Indiana’s plan to ban sweepstakes casino games. Wallach challenged those saying that sweepstakes casino operators aren’t violating any laws.

He added that under existing state laws, these sites contravene the state’s prohibition on casino-style games and gambling devices. Wallach shared a few points that can put the debates into clearer perspective:

• Indiana courts have already ruled on “promotional games with free points”, saying that these are “gambling devices”, even though players can earn free entries without making a purchase.

• In Jack Eiser Sales Co. v. Wilson, a local court ruled that a free spin machine that awarded a playing card, and allowed the player to use promotional credits to play a slot machine-like game where prizes are redeemable for cash, is also a “gambling device”.

• The Court noted that consideration is present, since if the free spins earn more points, the player may decide to spin more, risking all his points.

For Wallach, all these points raised previously by the court naturally fit into the aims of HB 1042. “Indiana’s statutory prohibitions against Internet gaming and 'gambling devices' (as interpreted by the Indiana Court of Appeals, the Indiana Attorney General, and the Indiana Gaming Control Division) make it clear that the dual-currency sweepstakes casino business model runs afoul of Indiana law”, explained Wallach.

HB 1042 Will Help Clarify Sweepstakes Casinos’ Legality

Although the tone of the recent bill shares the messaging of existing laws, Wallach still sees its value. He argued that HB 1042 is a “clarifying legislation” which aims to halt the operations of these sites based on flawed legal arguments. Without this, he said, sweepstakes casino operators will continue to skirt state laws.

HB 1052 will also assign additional powers to the Indiana Gaming Commission, including the ability to levy civil penalties of up to $100k.

While Wallach’s opinion piece backs the state’s stand on sweepstakes casino games, the industry has also found a few allies.

During the hearing, a few invited resource speakers threw their support behind the operators. VGW and the Social Plus Gaming Association (SGLA) pushed for sensible regulation, and Rep. Jim Lucas added that current laws don’t explicitly classify these games as forms of illegal gambling.

REFERENCES:

• Daniel Wallach LinkedIn

• Forbes