One signature away: Governor Newsom to decide the fate of sweepstakes ban (AB 831) by 12 October

• Assembly Bill 831 passed unanimously in both California chambers with 79-0 Assembly vote and 36-0 Senate approval
• Governor Gavin Newsom has until 12 October to sign, veto, or allow the bill to automatically become law
• The legislation targets online sweepstakes casinos using dual-currency models

California’s comprehensive ban on online sweepstakes casinos is now just one signature away from becoming law, after Assembly Bill 831 received overwhelming bipartisan support in the state legislature.

The Assembly voted 79-0 to approve the Senate’s amendments to the controversial legislation, with only Assembly member James Ramos absent from the final vote.

Governor Gavin Newsom now has until 12 October to either sign or veto the bill, with the measure automatically becoming law if he takes no action. The legislation would take effect on 1 January 2026 if enacted.

Targeting dual-currency operators

AB 831, authored by Avelino Valencia, specifically targets online platforms that use “dual currency” models to circumvent California’s gambling regulations. These operators allow players to purchase virtual coins and play casino-style games, with the ability to redeem “sweeps coins” for cash prizes.

“Online sweepstakes casinos have increased in popularity by exploiting no purchase necessary and use dual currency models to take advantage of a grey area in the law,” Valencia said.

“By operating as an online casino with real cash payouts, these platforms are circumventing the will of the voters and sidestepping the state’s gaming framework”.

Violations would carry penalties of up to $25,000 in fines and one year in jail, though the legislation specifically excludes players from criminal liability. The bill targets operators, payment processors, platform providers, and even celebrity endorsers who promote these platforms.

Strong tribal support drives legislation

The measure has received robust backing from California’s tribal gaming interests, who view sweepstakes casinos as unfair competition to their regulated operations. The California Nations Indian Gaming Association and numerous tribal groups, including the San Manuel Band of Mission Indians and Morongo Band of Mission Indians, have thrown their support behind the legislation.

“Allowing online sweepstakes casinos to continue operating in the state will destabilise the entire legal gaming ecosystem,” tribal leaders declared during committee hearings.

San Bernardino County District Attorney Jason Anderson emphasised the bill aims to target offshore operators, not consumers, clarifying that enforcement would focus on companies running illegal dual-currency gambling models.

Industry groups mount opposition campaign

Despite unanimous legislative support, the bill faces strong resistance from gaming industry organisations. The Social Gaming Leadership Alliance expressed disappointment over the lack of debate, warning the ban would eliminate more than $1 billion in direct and indirect economic activity annually.

“It is incredibly disappointing that the California Assembly decided to pass AB 831,” Jeff Duncan, Executive Director of SGLA wrote.

“Beyond the fact that this bill would worsen economic disparities among California tribes, put California to the back of the line in terms of digital innovation in this space, and take away a popular form of entertainment for residents, it will immediately strip $1 billion out of the state’s economy.

“We implore Governor Newsom to veto this bill and instead open the door for online social games to support economically disadvantaged tribal nations and the state’s economy while positioning California as a leader in next-generation gaming technology.”

The Social and Promotional Games Association has criticised the bill as “too vague, too rushed, and too risky,” arguing it lacks clear definitions for key terms like “dual currency system” and “cash equivalents”.

Industry groups warn the broad language could inadvertently criminalise legitimate marketing promotions used by mainstream companies.

Legislative manoeuvring raises concerns

AB 831’s path through the legislature has drawn scrutiny over the tactics employed. The bill originally dealt with unrelated tribal gaming matters when it passed the Assembly in May, but Senate amendments in June completely transformed it to target sweepstakes casinos.

Assembly Chair Blanca Rubio noted during the final vote how there was no public testimony on the bill, describing this as a “seemingly crucial aspect” for legislation that would ban an activity for the public.

Four Northern California tribal gaming groups broke ranks to oppose the legislation, with representatives arguing it protects established tribal casino monopolies rather than serving broader interests.

The legislation positions California alongside other states increasingly cracking down on sweepstakes casino operations, as regulators nationwide scrutinise the sector’s legal grey areas. With Newsom’s decision looming, the Golden State could soon join the growing list of jurisdictions implementing comprehensive sweepstakes gaming bans.