Louisiana Department of Revenue sues VGW and WOW Vegas for $44.4 million in sweepstakes tax case

• Louisiana’s Department of Revenue files lawsuits against major sweepstakes operators VGW and WOW Vegas seeking unpaid taxes, interest, and penalties
• Lawsuits follow state Attorney General ruling declaring online sweepstakes casinos illegal under Louisiana law
• VGW targeted for nearly $31 million, WOW Vegas for $13.5 million; both accused of operating without proper tax compliance

The Louisiana Department of Revenue has taken legal action against leading online sweepstakes casino operators VGW and MW Services (doing business as WOW Vegas).

The state is seeking a combined total of $44.4 million in unpaid taxes, interest, and penalties related to their sweepstakes operations in Louisiana. This follows an official legal opinion issued by Louisiana Attorney General Liz Murrill in July 2025, which declared such online sweepstakes businesses illegal in the state.

According to reports, VGW accounts for approximately $30.9 million of the sum claimed, including $16.7 million in back taxes, over $5 million in interest accrued from January 2019 to December 2024, and millions more in various penalties.

WOW Vegas faces claims of $13.5 million, with $7.5 million in current taxes owed from January 2021, nearly $1.9 million in interest, and additional penalties.

The lawsuits allege both companies conducted business targeting Louisiana residents without proper tax registration or compliance.

The Louisiana Department of Revenue states that VGW and WOW Vegas sold above $100,000 worth of digital goods to state residents, constituting doing business within Louisiana’s jurisdiction and triggering tax liabilities.

Despite legislative efforts to bar sweepstakes casinos — a bill that passed both houses was vetoed by Governor Jeff Landry — enforcement actions have increased. The Attorney General issued an opinion affirming that online businesses offering casino-style sweepstakes games operate illegally under state law. The opinion allows state agencies to pursue back taxes and penalties against these operators.

“As these businesses have been operating in and profiting from their operations in Louisiana, albeit illegally, they are still subject to Federal and State tax laws and liabilities,” said the Attorney General’s office in its ruling.

The Department of Revenue detailed VGW’s business tactics, citing how the company has adjusted its operations in other states to comply with differing legal environments.

VGW recently closed its Luckyland platform in Delaware and withdrew sweepstakes products in New York, but continued free-to-play games. VGW also communicated directly with Louisiana players about phasing out certain sweepstakes coins within the state.

“In spite of the Defendants’ newfound desire to become compliant with state tax laws, the Defendants have thus far failed to register with the Department or collect and/or remit any state or local sales tax from its operations in Louisiana,” the lawsuit states.

WOW Vegas ceased its Louisiana sweepstakes operations in July 2025 after receiving a cease-and-desist order from the Louisiana Gaming Control Board. The state maintains claims for unpaid taxes and penalties accrued during its period of operation.

This legal action is part of wider regulatory and enforcement efforts in Louisiana, reflecting growing scrutiny on the sweepstakes casino industry nationwide. Several states have passed laws banning such operations amid concerns about their legality and consumer risk.

Louisiana’s Attorney General Murrill indicated the laws currently provide sufficient authority for enforcement without the need for new legislation. Proposed penalties for operators can include fines up to $20,000 and prison sentences of up to five years for violations.

“Louisiana will not tolerate illegal operators who put our citizens at risk and undermine the fairness and integrity of our gaming industry,” said Christopher B. Hebert, Chairman of the Louisiana Gaming Control Board.

This lawsuit exemplifies how tax and legal frameworks are being used by Louisiana to seek recovery of significant revenue lost from unregulated online sweepstakes activities.