Regulators Force VGW Out of Maryland, Demand Legal Clarification

The Maryland Lottery and Gaming Control Agency has made its message clear to Virtual Gaming Worlds (VGW), the Australian-based operator behind popular sweepstakes casinos Chumba Casino and Luckyland Slots. Just one day after VGW's lobbyist opposed Senate Bill 860, which seeks to ban online sweepstakes casinos, the state's gaming regulator sent a stern cease-and-desist letter.

The Letter and Its Demands

The letter, authored by Managing Director Michael Eaton, explicitly states that VGW has been operating online gaming activities in Maryland without proper authorization. The regulator underscores that the only forms of online gaming permitted in the state are sports wagering and fantasy competitions, both of which require state-issued licenses or registrations—licenses that VGW does not possess.

VGW has been asked to confirm by March 27, 2025, whether they are still conducting any form of gaming in Maryland. If VGW confirms its activities, it must provide detailed descriptions of all current gaming offerings and produce a legal analysis or opinion supporting the legality of its operations under state law.

Potential Repercussions for VGW

Should VGW fail to comply, the regulator warns that the company's future opportunities for obtaining gaming licenses or registrations in Maryland could be seriously jeopardized. The timing of the letter, coming immediately after VGW’s opposition to Senate Bill 860 and shortly before a House Ways and Means Committee hearing, suggests strategic pressure from regulators.

The Legal Opinion Quandary

This request marks the first occasion a state regulator has explicitly demanded a legal opinion from VGW justifying the legality of its sweepstakes model. This model has drawn significant skepticism, evidenced by multiple lawsuits, cease-and-desist orders, and recent criminal charges against a prominent sweepstakes operator in Connecticut. Despite ongoing legal pressures, VGW has remained tight-lipped, reluctant to disclose any detailed legal analysis.

The Broader Implications

VGW faces a challenging decision—resist the regulator’s demands and risk bolstering legislative efforts to ban sweepstakes casinos, or comply and potentially embolden other states to issue similar demands. The ripple effect of VGW’s decision may significantly influence the legislative landscape for sweepstakes casinos nationwide, especially in states like New York, New Jersey, Connecticut, Florida, and Mississippi, where similar bills are pending.

VGW’s Next Move

With only days left to respond, VGW's decision will undoubtedly have lasting repercussions. If VGW exits Maryland, either voluntarily or due to legislative mandates, it could trigger a domino effect, inviting similar legal scrutiny across other states. Conversely, resisting Maryland’s demands could solidify legislative support for a widespread ban on sweepstakes casinos. The upcoming days will be crucial in determining VGW's strategy and the future of sweepstakes casinos in Maryland and beyond.