Tribal leaders slam sweepstakes gaming and DFS+ as illegal gambling

Tribal gaming leaders have warned that sweepstakes operators represent an existential threat to Indian Country in a damning riposte against the sector.

Indian Gaming Association conference chair Victor Rocha and California Nations Indian Gaming Association (CNIGA) chair James Siva laid out their concerns in a Zoom press conference yesterday, October 16.

The duo, who were joined by Indian Gaming Association executive director, Jason Giles, explained how, in their view, sweepstakes operators and DFS+ firms had “snuck up” on tribal operators in California.

Rocha explained that after attending a mixer at G2E in Las Vegas last week, the scale of the sweepstakes market had truly dawned on him and hit out at the sector for multiple deemed failings.

Rocha said: “They’re mocking us in our face. They’re unregulated, they’re untaxed, they don’t do KYC. If you go to the App Store right now, you have to be 18-years-old. This is gambling on training wheels.

“It’s still a nascent industry. We’re looking around the country and people are starting to recognize this threat. I think we need to start sharing resources with some of these other states and take a look at how this is contained.

“This is an issue that we see as existential, not just to California but to the rest of Indian Country, to the gaming industry, [and] to the commercial gaming industry.”

Sweepstakes have exploded in recent months, with the topic being the talk of the town at G2E.

Analyst firm Eilers & Krejcik Gaming has estimated the sector was worth $11bn in 2023, up 66% on 2022, with more growth on the horizon.

The vertical, which critics argue allows for sports betting under a different guise, was also called out by Flutter CEO Peter Jackson at G2E as he encouraged operators to “cross the Rubicon” and enter the regulated arena.

Siva said the rise of sweepstakes and the threat posed in California was similar to that of the sports betting push in 2022, which the tribes were ultimately able to defeat.

The likes of DraftKings and FanDuel spent millions of dollars in lobbying to bring sports betting to the state before being roundly rejected at the voting booth by California residents.

Siva said: “California is the engine that drives tribal gaming. So, how this turns out will have mass effects across Indian Country, but I am more than confident that California tribal leadership is up to the fight, again.

“We showed that with the big sports betting companies, the DraftKings and FanDuels of the world, you might be a billion-dollar corporation but if you want to come into California, it begins and ends with tribes, period.

“I keep saying it over and over again, and I think some of them are finally hearing it and actually listening, but then figure that out too.”

Siva also noted that the tribes would not allow for half measures in their efforts to push back against DFS+ and sweepstakes.

He alluded to AB 1437, a bill introduced in the Golden State in 2015 that would have legalized DFS.

Ultimately, the bill failed to come into law, but Siva says a lack of killer instinct on behalf of the tribes had allowed space for non-tribal operators to return.

He said: “DFS first came up, I think 2015, there was a bill that was run by some legislators. We were able to get it killed.

“And, you know, probably partly on the tribes, we thought that was the end of it. We didn’t give it that final kind of death blow. This time, whatever the outcome, it will be final. There will not be a second bite of the apple after this.”

The webinar marked the first of five episodes on the topic, with Rocha confirming the American Gaming Association (AGA) and the Sports Betting Alliance’s Jeremy Kudon are due to make appearances in subsequent calls.