bet9ja.com
The smiling faces of Paris Hilton and Ryan Seacrest made surprise looks before the Louisiana Senate for Friday's hearing on prohibited sports betting.
bit.ly
No, they weren't personally in presence, however the world-famous celebrities were conspicuously consisted of in a slide discussion on social and sweepstakes casinos - the questionable sites offering both free casino-style games and financially rewarding prizes, such as cash, gift cards or cryptocurrency. In one advertisement, the fist-pumping Seacrest is seen plugging Chumba Casino, where anybody can 'play for totally free,' while a crop-topped Hilton holds a chip for sweepstakes operator, Wow Vegas, in the other.
bet9ja.com
The websites are just two cogs in the multibillion-dollar industry that now finds itself besieged by lawsuits. In the eyes of numerous video gaming corporations, not to mention claim complainants and state regulators, sweepstakes casinos serve as standard casinos, just without the oversight, consumer defenses and tax laws. So not only can they prevent the high 24-percent federal gambling levy, but sweepstakes operators aren't based on regulatory obstacles like anti-money laundering and responsible-gaming securities.

One operator, Australia-based Virtual Gaming Worlds (VGW), reported $4 billion in profits in 2015 alone. Now the business faces accusations of unlawful sports betting in a New York claim that claims VGW utilizes star endorsers to 'create a veneer of authenticity' around its product. (See VGW's statement below)

'I'm not exactly sure" if you do not trust us, you can trust Paris Hilton" is a winning message for business operating multibillion-dollar illegal operations out of locations like Malta, Isle of Man, or US mail drops,' Friday's speaker, Howard Glaser of video gaming corporation Light & Wonder, told DailyMail.com.

Sweepstakes endorsers include a series of celebs from sports betting lovers Drake and DJ Khaled to swimmer Michael Phelps, as well as NBA stars Karl-Anthony Towns and Paul George - none of whom provide any differences in between conventional sports betting and sweepstakes play.

Paris Hilton is seen plugging Wow Vegas, among many sweepstakes gambling establishments found online

Ryan Seacrest urges fans to dip into Chumba Casino, where numerous - but not all - games are free

Drake has a handle social sweeps casino, Stake, that he regularly touts on social media

Find out more

Donald Trump 'set to name NBA group owner as US ambassador to Italy'

Instead, advertisements usually center around the social element of the gambling establishments, while omitting the potential for real gambling losses.

Others tempt consumers with guarantees of rewards. One such operator, Stake, ran a social media advertisement revealing off Drake's vehicles, airplanes and estates before rotating to footage of the rapper playing online casino-style games.

'Daddy, why do we have a lot money?' read the first caption on the screen.

Another caption explained: 'Because I never offered up.'

The disparity in between sports betting sites and social or sweepstakes gambling establishments is a bit complicated, but operators of the latter insist they're not included with the former.

A representative for an industry trade group, the Social and Promotional Gaming Association (SPGA), described its members are not in direct competition with online gambling establishments and sportsbooks. Furthermore, according to SPGA data, the majority of the players on social-sweepstakes gambling establishments are playing for free.

'Most social sweeps clients never buy,' the SPGA spokesperson informed DailyMail.com. 'The minority of clients who make purchases do so in amounts far smaller sized than the common deposit or wager size at real-money online sports betting sites.'

Social casinos offer clients an opportunity to play casino-style games with buddies. Players have the choice to purchase worthless currency frequently described as 'gold coins,' which can not be exchanged genuine money, however can be used to open numerous features within the games.
bet9ja.com
But within the world of social casinos exists sweepstakes video gaming, enabling consumers to get other currency referred to as 'sweeps coins' that can be exchanged for money or other prizes.

And therein lies the potential for monetary losses, like the ones declared by complainants in Florida, Georgia, New Jersey and New York. One gamer told the Washington Post he lost more than $100,000 on sweepstakes casinos in the previous year after continuing to buy more coins in pursuit of money and other things of value.

The Philadelphia 76ers' Paul George is seen promoting an International Poker event

Social sweeps gambling establishment Stake ran an ad flaunting Drake's vehicles, planes and mansions

Karl-Anthony Towns of the New York City Knicks is another NBA star plugging VGW's Global Poker

Traditional online gambling establishments are banned in all but seven states, which has actually helped to sustain the popularity of sweepstakes casinos.

Anyone over the age of 18 can access the sweepstakes websites, which don't require normally need recognition. However, sites like Chumba will request for IDs from gamers attempting to withdraw any funds.

Many websites, like the crypto-compatible Stake, enable consumers to send mail-in requests for free sweeps coins, the players follow painfully particular guidelines. What's more, players are often rewarded with sweeps coins just for signing up, thereby offering them a factor to attempt their hands at any variety of gambling establishment video games for a chance to win - or lose - real money.

So why are sweepstakes websites enabled to operate in 48 states, while online casinos are prohibited in all but 7?

According to the stakeholders, their product is the free casino-style gaming, and the real-stakes competition is just a means of promoting their support.

'Social sweepstakes video games are simply a kind of online entertainment,' an SPGA representative told DailyMail.com by email. 'No purchase is required to play at social gambling establishments with sweepstakes prizes. Consumers never ever need to spend for an opportunity to win rewards. That lack of a purchase requirement - or" factor to consider" - is an important difference between social sweeps and traditional online gambling sites like gambling establishments.'

Think of the manner in which McDonald's utilizes its yearly Monopoly video game to promote its food: Customers aren't paying to bet, but rather they're purchasing hamburgers and french fries that offer them the opportunity to win profitable rewards, such as a $1 million jackpot.

And without a purchase requirement, or 'factor to consider', the game itself does not satisfy the definition of sports betting in the US.

'Sweepstakes are an enduring technique for promoting all sort of everyday organizations in the United States, whatever from hamburgers to magazine memberships to coffee and home improvement stores,' the SPGA representative told DailyMail.com. 'Sweepstakes promos are regularly utilized by a who's who of household names like AT&T, Chase, Home Depot, Marriott, Starbucks, and Wal-Mart.'

But to lots of sports betting market insiders, that argument does not cut it.

For beginners, gaming attorney Daniel Wallach explains, McDonald's Monopoly game does not run forever. Rather, it has a distinct beginning and end, thus suggesting the sweepstakes is not the fast-food giant's main product. Instead, the sweepstakes is being used to promote real products like french fries, shakes, and the Filet-O-Fish.

'They do not last permanently and they're generally not tied to casino-style games of opportunity,' Wallach informed DailyMail.com. 'They're just cash giveaways.

'The sweepstakes [gambling establishments] have none of the attributes typically related to McDonald's-style sweepstakes promos,' Wallach continued. 'Besides running in eternity, the sweepstakes gambling establishments provide" casino-like" payouts, usually 80 percent or more of revenues, whereas the common payment portion for a short-lived advertising sweepstakes is an unimportant share of the profits earned by the business [generally less than one percent]'

Wallach is quick to liken the online social sweeps casinos to the web cafes that sprang up in Florida, offering customers the opportunity to play casino-style games for real rewards. A lot of those brick-and-mortar facilities have actually since been shuttered over allegations of unlawful gaming.

DJ Khaled is amongst numerous celebrity spokespeople for VGW's Global Poker brand

Now, Wallach argues, social sweeps casinos need to face similar examination.

'These differences are not arbitrary,' Wallach said of social sweeps gambling establishments. 'They have actually repeatedly been pointed out by courts and state chief law officer as crucial consider figuring out that a sweepstakes promo was in fact a guise for prohibited gaming.'

One of the casino industry's leading trade organizations, the American Gaming Association, is now pressing legislators to investigate sweepstakes operators and, in many cases, enact new legislation on the concern.

'Consumers are being denied of defenses and states are giving up considerable tax and income opportunities as this gambling replaces that carried out through managed channels,' read a well-circulated AGA memo.

And after that there are the plaintiffs who have taken legal action against social casinos in more than a dozen states.

Sweepstakes casino operators paid a combined $14.2 million in 4 separate cases in Kentucky without admitting any misbehavior, according to the Washington Post. Meanwhile VGW accepted pay $11.75 million in one class-action suit, stating the settlement was made to avoid legal costs and continued lawsuits.

Michael Phelps has signed a deal with the VGW Group, which owns Global Poker

In the current lawsuit, which is mainly comparable to its predecessors, New York state residents Lamar Prater and Rebecca Pratt both declare to have actually lost well over $1,000 to VGW, which is described in the filing as an 'prohibited gaming business. '

Apple and Google have likewise been called as accuseds in lawsuits for hosting the sweepstakes sites. But unlike VGW, neither tech business responded to DailyMail.com's request for comment.

'We usually do not discuss matters before the courts,' a VGW spokesperson told DailyMail.com via e-mail. 'However, we keep in mind that this claim has only simply been submitted with the court and VGW has not been officially served.

'We have full self-confidence in our compliance with all laws and regulations where we run, and stay confident about the future,' the spokesperson continued. 'We continue to use our free-to-play games across many of North America, as we have for more than a decade, producing not just excellent video games, user experiences and home entertainment, but also ensuring this is done safely, responsibly and at the highest level of standards.

'More broadly, we 'd repeat that class actions and other litigations and arbitrations are relatively typical across the online social video games market (and the US more broadly), and our standard practice is that we plan to vigorously safeguard any claim which might be brought against us.'

The concerns between traditional online gambling and sweepstakes gambling establishments could show problematic for some celebrity endorsers.

Towns, a star center with the Knicks, and the 76ers' George both endorse VGW's Global Poker brand while the NBA is partnered with traditional gaming titans like FanDuel and DraftKings.

'It's ironic that professional athletes are hawking illegal sports betting 'sweeps' websites while at the exact same time the leagues wish to project a strong position against illegal sports betting - specifically when trying to tamp down the periodic sports betting scandal,' Glaser informed DailyMail.com.

It was simply 8 months ago that Toronto Raptors forward Jontay Porter got a lifetime restriction from the NBA over allegations he conspired with gamblers. However, to be clear, Porter's scandal is unrelated to anything involving social or sweepstakes casinos.

Together with VGW, Apple and Google are being demanded hosting apparently unlawful gambling websites

Regardless, Glaser sees sweepstakes casinos as a major issue for leagues such as the NBA.

'I 'd anticipate that a league crackdown on professional athletes backing sweepstakes websites is a matter of when, not if,' Glaser included.

Neither an NBA spokesperson nor the players' representatives responded to DailyMail.com's requests for comment. For that matter, spokespeople for Drake, DJ Khaled, Hilton, Seacrest and Phelps likewise ignored to react to DailyMail.com emails.

Asked if their star endorsers have a responsibility to describe to clients the differences and similarities between iGaming and sweepstakes casinos, VGW insisted there is absolutely nothing more that needs to be done.

'We have full confidence in our influencer and ambassadorial partnerships, and our business practices more broadly,' the representative stated. 'A few of our worths are" our gamers come initially" and" we do what's right", and we put our values at the core of everything we do.'

Glaser, an outspoken opponent of sweepstakes websites, sees things differently.

'Celebrities who provide their names to shady illegal gambling sites are, at a minimum, putting their track records at threat along with courting civil and class actions by consumers who allege damage,' Glaser said. 'There is also some threat that state regulators and state chief law officers rope star endorsers into enforcement efforts for facilitating illegal gambling.'

New YorkNBADrakeParis Hilton