Maryland lawmakers gave a warm reception to the Maryland Illegal Online Gambling Enforcement Act during a Senate Budget and Taxation Committee hearing Wednesday, with the Maryland Lottery and Gaming Control Agency, or MLGCA, pushing for expanded powers to target sweepstakes casinos and offshore sites using dual‑currency tricks to evade regulation.
Maryland’s Senate Budget and Taxation Committee heard testimony in favor of Senate Bill 652, but did not act on the legislation Wednesday.
Introduced by Sens. Jeff Waldstreicher and Chris West at the request of the MLGCA, the bill would create a comprehensive framework to crack down on illegal gambling, targeting sweepstakes casinos and other unregulated gambling websites. It does explicitly define “multiple currency systems” used in sweepstakes casino platforms that simulate casino gaming. Those systems allow players to exchange game currency for prizes or cash.
If passed, the bill would grant the MLGCA greater enforcement authority to issue cease-and-desist orders, seek injunctions, freeze accounts, and fine violators. The bill also provides more powers to the attorney general. It also extends beyond operators to third-party vendors, including payment processors.
“What this bill does is provide a structure with the AG and other prosecutors can hold illegal gambling sites accountable, not just criminal prosecution, but starting with cease-and-desist letters and escalating,” Walstreicher said in his testimony. “It takes on not just the operators but the third-party vendors that surround them allow them to take place.”
The MLGCA has already issued 89 cease-and-desist letters to unregulated gambling operators in the state, including sweepstakes casino giant VGW, according to Jennifer Beskid, MLGCA director of legislation & policy. Beskid said the agency has a 25% success rate in shutting down sites, but this bill would expand its enforcement options.
The bill does clearly exclude licensed sports betting and fantasy sports operators.
Maryland lawmakers already discussed a different sweepstakes prohibition bill earlier this year.
Walstreicher believes the enforcement bill is needed
Walstreicher said, “Illegal gambling is an incredible scourge for four distinct reasons.” He went on to list those reasons:
- Reduces revenue for “things we care about like education and making up for things happening at the federal level.
- Reduces union jobs and pay at licensed casinos in the state
- Does not have problem gambling protections
- Does not have consumer protection associated with it
Several representatives from Maryland casino operators also testified in support of the bill. Mark Stewart, Cordish Companies executive vice president and general counsel, said the bill would put Maryland in line with other strong regulatory markets like New Jersey, New York and Nevada. Stewart said the legislation would allow courts to shut down illegal websites and block payment processors.
Brad Rifkin, representing Baltimore’s Horseshoe Casino, said the legislation is of “paramount importance to the residents of Maryland and licensed gambling entities.”
While it applies to offshore sportsbooks and online casinos, Rifkin made specific mention of Maryland sweepstakes casino operators in his testimony. He also mentioned the recent lawsuit brought by the City of Baltimore against several sweepstakes casino operators.
Maryland sweepstakes legislation history
Last year, the Maryland Senate was one of the first chambers in the United States to pass a sweepstakes prohibition bill. And it did so overwhelmingly, 47-0.
The bill, however, fell short and died in a House committee last session.
While Maryland did not pass a ban last year, six other states did see governors sign prohibitions into law, including California, New Jersey and New York. Many other state regulators, including Maryland and Louisiana, where Gov. Jeff Landry vetoed a prohibition bill, sent hundreds of cease-and-desist letters to unregulated sweepstakes operators.
This year, multiple state legislatures are considering sweepstakes prohibition legislation, including Indiana, which has already sent a bill to Gov. Mike Braun.
