Arkansas Attorney General sues sweepstakes operator VGW over alleged deceptive marketing
Arkansas AG Tim Griffin has filed a lawsuit accusing VGW of deceptive marketing under the state's Deceptive Practices Act, rejecting its claim that its sweepstakes products are not gambling.
GamblingSource: GamblingNews
Arkansas Attorney General Tim Griffin has filed a lawsuit against VGW, one of the biggest names in the sweepstakes casino sector, alleging that the company's business breaches the state's Deceptive Practices Act. The case is the latest legal challenge to a segment that has been contested for years.
Sweepstakes operators run online games using a dual-currency model that permits both free and paid play. Supporters of the model say the ability to play without staking money separates sweepstakes from conventional gambling, and the sector has long operated in a gray area with limited regulation.
Griffin rejected that position. He said any sensible person would regard sweepstakes as gambling despite the two currencies, and described the argument that a meaningful distinction exists between the currency players earn and the one they buy as "weak at best." He stated that anyone offering Arkansans a way to gamble money in the state is subject to the rules governing legal gambling.
The suit focuses on VGW's ongoing marketing, which the attorney general called aggressive and misleading. According to Griffin, the company has kept using a deceptive marketing model even though it knows its legal status is "not nearly as clear" as its advertising implies. One VGW brand describes itself as "100% safe and 100% legal." VGW's Chumba Casino, LuckyLand Casino and Global Poker brands are all available in Arkansas. The lawsuit seeks restitution, penalties, taxes and injunctive relief.
A comparable action in New York ended with Attorney General Letitia James forcing VGW to pay $8 million, which could serve as a precedent in the Arkansas matter.
Griffin has a record of opposing unlicensed gaming products and so-called gambling-like offerings, including sweepstakes and prediction markets. He has also previously sued prediction market operator Kalshi, arguing that its products violate local law. The rise of prediction markets has drawn some attention away from sweepstakes, making lawsuits against sweepstakes operators somewhat less frequent.
Eight states have already explicitly banned sweepstakes: California, Connecticut, Indiana, Maine, Montana, Nevada, New Jersey and New York. Amid continued pushback, VGW has been forced to scale down its US-facing business.
Based on reporting by GamblingNews.