A Call To Action

By Judy Patterson, Senior Vice President and Executive Director, American Gaming Association (AGA)

As we’re busy gearing up for the largest meeting of the gaming industry in the world, I want to take this opportunity to call the industry’s attention to a growing threat of which we all must be mindful in the weeks and months ahead.

The relatively new phenomenon known as Internet sweepstakes cafes is growing rapidly in various states. Proprietors claim their businesses don’t constitute gambling, but in reality these are the latest in a long history of attempts to pass off a gambling product as non-gambling while putting consumers and our industry’s reputation at risk.

Internet sweepstakes cafes exist in a legal gray area and undermine existing state gambling policies. And, whether intentionally or not, they have the real potential to cannibalize the market for existing state-sponsored and regulated gambling, including lotteries and tribal and commercial casinos. 

Bloomberg Business Week recently estimated that national revenue for the cafes exceeded $10 billion in 2011. In all, sweepstakes cafes likely exist in well over two dozen states. By and large, law enforcement, courts and legislatures have not yet adequately addressed the legality of Internet sweepstakes cafes. In the meantime, new sweepstakes cafes continue to pop up in new states and localities at alarming rates.

The AGA is taking a number of steps to address the growth of Internet sweepstakes cafes. We are publishing a detailed white paper on the topic that will soon be distributed to industry leaders and key decision makers across the country.

We also plan to work with our member companies and state associations to educate state lawmakers and other stakeholders about this issue. We will encourage states where internet sweepstakes cafes are currently present to outlaw them and states where they are not currently present to enact laws and regulations preventing them from opening.

I call on all those working in the gaming industry to get educated about Internet sweepstakes cafes and join our efforts to stem the growth of these unregulated establishments. They threaten our business, lack consumer protections and potentially damage our industry’s reputation for integrity and compliance that we have worked so hard to earn.  Be on the lookout for our white paper coming soon, and we look forward to keeping you abreast of our activities as this coordinated effort continues.

For more information or to get involved, contact me at jlp@americangaming.org.