Key Moments:
- California Senate Appropriations Committee advanced A.B. 831 on August 28, 2025, with a 7-0 vote
- The bill would criminalize sweepstakes casinos using a dual currency system with penalties up to one year in jail and $25,000 in fines
- Lawmakers must vote on A.B. 831 by September 12, 2025, the last day for legislative action this year
Senate Committee Advances Crucial Bill
Sweepstakes casinos, which have quickly grown in popularity across the United States by providing cash-redeemable prizes in a legal gray area, are facing strict scrutiny in California. Assemblymember Avelino Valencia’s Assembly Bill 831 seeks to prohibit internet casinos operating under the sweepstakes model throughout the state, pointing to their resemblance to unauthorized online gambling operators despite their claims of being promotional contests.
On August 28, 2025, the California Senate’s Appropriations Committee conducted its “suspense” hearing, quickly advancing multiple bills without discussion. A.B. 831 passed unanimously with a 7-0 vote. Committee chair Senator Anna Caballero clarified that members could change their positions before the full Senate floor vote, as the committee’s action was purely procedural.
NEW: California Senate Floor Analysis of AB 831 cites Sup. Ct.'s decision in Grewal, where patrons received 100 sweepstakes credits for every $1 purchased of internet time to play virtual slots for prizes; characterized as a "subterfuge to mask the illegal gambling activity." pic.twitter.com/oPcs8uZR2N
— Daniel Wallach (@WALLACHLEGAL) September 1, 2025
Key Details of the Proposed Legislation
A.B. 831 is designed to ban internet-based sweepstakes platforms that simulate casino gaming activities, including sports betting. The legislation directly targets the “dual currency” model, in which players purchase virtual coins for gameplay and can exchange certain winnings for cash. Those who operate in violation may be charged with a misdemeanor, which could lead to up to one year in jail and fines from $1,000 to $25,000.
| Provision | Description |
|---|---|
| Prohibited Activities | Sweepstakes casinos and online gambling with cash-redeemable virtual currencies |
| Potential Penalties | Up to one year in jail and fines between $1,000–$25,000 |
| Legislative Deadline | September 12, 2025 |
Legislative Progress and Timeline
Originally addressing other concerns, A.B. 831 was amended in June to focus specifically on online sweepstakes casinos. Since then, the bill has advanced through various committees in the Senate, including the Appropriations Committee. A final vote must occur by September 12, 2025, marking the end of the legislative session this year. Should both the Senate and Assembly pass the measure, it will proceed to the governor for approval, potentially making it state law in early 2026.
Support from Tribal Gaming Interests
The Yuhaaviatam of San Manuel Nation has voiced strong concerns about unregulated sweepstakes casinos, arguing that they undermine public confidence in California’s regulated gaming industry. The Nation stated, “The state’s voters have consistently shown their trust in Native American tribes to operate gaming facilities responsibly and ethically. Allowing unregulated and predatory sweepstakes operators to bypass these regulations undermines the trust and integrity of California’s gaming policies.”
Similarly, the California Nations Indian Gaming Association (CNIGA) continues to emphasize voter support for tribal management of gaming within the state, arguing that sweepstakes casino platforms take advantage of uncertainties in current laws. Several tribal gaming operators throughout California back the measure as a means of upholding the industry’s regulatory integrity.
Dissenting Perspectives
Not all stakeholders support the proposed sweepstakes ban. The Sherwood Valley Band of Pomo Indians has expressed worries that the legislation could impact smaller tribes’ efforts to pursue digital gaming. Opponents of the bill argue that a sweeping prohibition may worsen economic disparities and limit tribal autonomy in online gaming initiatives.
Bourassa noted, “We urge the Committee to reject AB 831 and instead support policy solutions that empower all tribes to diversify economically, address systemic challenges, and chart a path toward sustainable self-governance and prosperity.”
Context: Statewide and National Enforcement
Other states have already enacted their own legislation prohibiting sweepstakes casinos as of September 2025, including Montana, Washington, Michigan, New Jersey, Massachusetts, and New York. Montana’s SB555, for example, clearly targets gambling with virtual currencies redeemable for cash. New York’s Attorney General issued cease-and-desist letters to 26 operators in June 2025, reinforcing the state’s law that forbids betting with cash-redeemable online tokens.
Further enforcement actions have taken place in Connecticut, Nevada, and Louisiana, where sweepstakes casino operators have been ordered to stop activities. Some of these states use current gambling laws for regulation, while others consider outright bans. In Louisiana, a proposed prohibition was vetoed by the governor, who stated the existing enforcement approach adequately addresses violations.
- Author
Daniel Williams
