bit.ly
The smiling faces of Paris Hilton and Ryan Seacrest made surprise looks before the Louisiana Senate for Friday's hearing on unlawful gaming.

No, they weren't personally in participation, but the world-famous stars were notably included in a slide discussion on social and sweepstakes gambling establishments - the questionable sites using both totally free casino-style video games and financially rewarding rewards, such as money, gift cards or cryptocurrency. In one ad, the fist-pumping Seacrest is seen plugging Chumba Casino, where anybody can 'bet complimentary,' while a crop-topped Hilton holds a chip for sweepstakes operator, Wow Vegas, in the other.

The sites are just two cogs in the multibillion-dollar industry that now finds itself besieged by lawsuits. In the eyes of lots of gaming corporations, not to point out suit plaintiffs and state regulators, sweepstakes gambling establishments act as traditional casinos, only without the oversight, consumer securities and tax laws. So not just can they avoid the high 24-percent federal sports betting levy, but sweepstakes operators aren't based on regulative difficulties like anti-money laundering and responsible-gaming protections.
bet9ja.com
One operator, Australia-based Virtual Gaming Worlds (VGW), reported $4 billion in earnings last year alone. Now the company deals with allegations of illegal sports betting in a New York suit that claims VGW utilizes celeb endorsers to 'develop a veneer of authenticity' around its item. (See VGW's declaration below)

'I'm unsure" if you don't trust us, you can trust Paris Hilton" is a winning message for business operating multibillion-dollar prohibited operations out of places like Malta, Isle of Man, or US mail drops,' Friday's speaker, Howard Glaser of gaming corporation Light & Wonder, told DailyMail.com.

Sweepstakes endorsers include a variety of stars from gambling lovers Drake and DJ Khaled to swimmer Michael Phelps, in addition to NBA stars Karl-Anthony Towns and Paul George - none of whom use any differences in between traditional gambling and sweepstakes play.

Paris Hilton is seen plugging Wow Vegas, among lots of sweepstakes casinos found online

Ryan Seacrest advises fans to dip into Chumba Casino, where many - however not all - games are totally free

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

Find out more

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

Instead, advertisements normally focus around the social element of the casinos, while leaving out the potential for real gambling losses.

Others lure consumers with guarantees of prizes. One such operator, Stake, ran a social networks ad displaying Drake's cars, aircrafts and mansions before rotating to video of the rap artist playing online casino-style games.

'Daddy, why do we have so much cash?' read the first caption on the screen.

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

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

A spokesperson for a market trade group, the Social and Promotional Gaming Association (SPGA), explained its members are not in direct competition with online casinos and sportsbooks. Furthermore, according to SPGA information, many of the players on social-sweepstakes casinos are sports betting complimentary.

'Most social sweeps customers never ever buy,' the SPGA representative informed DailyMail.com. 'The minority of consumers who make purchases do so in amounts far smaller sized than the typical deposit or bet size at real-money online gaming websites.'

Social gambling establishments use consumers an opportunity to play casino-style games with friends. Players have the choice to buy valueless currency often referred to as 'gold coins,' which can not be exchanged for genuine cash, but can be utilized to unlock numerous functions within the video games.

But within the world of social casinos exists sweepstakes video gaming, permitting customers to get other currency referred to as 'sweeps coins' that can be exchanged for money or other rewards.

And therein lies the capacity for financial losses, like the ones claimed by complainants in Florida, Georgia, New Jersey and New York City. One gamer informed the Washington Post he lost more than $100,000 on sweepstakes gambling establishments in the previous year after continuing to purchase more coins in pursuit of cash and other things of value.

The Philadelphia 76ers' Paul George is seen promoting a Global Poker occasion

Social sweeps casino Stake ran an ad displaying Drake's cars and trucks, aircrafts and estates

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 however seven states, which has actually helped to sustain the popularity of sweepstakes gambling establishments.

Anyone over the age of 18 can access the sweepstakes websites, which do not need normally require identification. However, sites like Chumba will request for IDs from players trying to any funds.

Many websites, like the crypto-compatible Stake, enable consumers to send mail-in ask for totally free sweeps coins, offered the players follow painfully particular instructions. What's more, gamers are typically rewarded with sweeps coins simply for signing up, consequently providing a reason to try their hands at any variety of gambling establishment games for an opportunity to win - or lose - real cash.
bet9ja.com
So why are sweepstakes websites permitted to run in 48 states, while online casinos are banned in all however 7?

According to the stakeholders, their item is the totally free casino-style gaming, and the real-stakes competitors is simply a way of promoting their bread and butter.

'Social sweepstakes video games are simply a kind of online entertainment,' an SPGA spokesperson informed DailyMail.com by e-mail. 'No purchase is needed to dip into social casinos with sweepstakes rewards. Consumers never ever have to spend for an opportunity to win rewards. That absence of a purchase requirement - or" factor to consider" - is an essential difference between social sweeps and traditional online gaming websites like gambling establishments.'

Think about the manner in which McDonald's utilizes its annual Monopoly video game to promote its food: Customers aren't paying to gamble, but rather they're buying hamburgers and fries that offer them the opportunity to win rewarding prizes, such as a $1 million jackpot.

And without a purchase requirement, or 'factor to consider', the game itself doesn't fulfill the definition of gambling in the US.

'Sweepstakes are a long-standing method for promoting all sort of daily organizations in the United States, everything from hamburgers to publication subscriptions to coffee and home improvement stores,' the SPGA spokesperson told DailyMail.com. 'Sweepstakes promotions are routinely utilized by a who's who of family names like AT&T, Chase, Home Depot, Marriott, Starbucks, and Wal-Mart.'

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

For starters, gaming lawyer Daniel Wallach points out, McDonald's Monopoly video game doesn't run forever. Rather, it has a well-defined start and end, therefore recommending the sweepstakes is not the fast-food giant's primary item. Instead, the sweepstakes is being used to promote genuine products like fries, shakes, and the Filet-O-Fish.

'They don't last forever and they're usually not tied to casino-style video games of opportunity,' Wallach told DailyMail.com. 'They're just cash giveaways.

'The sweepstakes [casinos] possess none of the attributes frequently related to McDonald's-design sweepstakes promotions,' Wallach continued. 'Besides running in all time, the sweepstakes casinos offer" casino-like" payouts, usually 80 percent or more of earnings, whereas the typical payout percentage for a temporary promotional sweepstakes is a minor share of the revenue made by the business [generally less than one percent]'

Wallach is quick to liken the online social sweeps gambling establishments to the web coffee shops that sprang up in Florida, offering customers the possibility to play casino-style video games for genuine prizes. Many of those brick-and-mortar facilities have actually considering that been shuttered over claims of unlawful gambling.

DJ Khaled is amongst a number of star spokespeople for VGW's Global Poker brand

Now, Wallach argues, social sweeps casinos should face similar scrutiny.

'These differences are not approximate,' Wallach said of social sweeps gambling establishments. 'They have actually consistently been pointed out by courts and state attorney general of the United States as key consider identifying that a sweepstakes promo was in fact a guise for illegal sports betting.'

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

'Consumers are being denied of protections and states are giving up significant tax and revenue opportunities as this sports betting replaces that carried out through regulated channels,' checked out a well-circulated AGA memo.

And then there are the plaintiffs who have actually sued social gambling establishments in more than a dozen states.

Sweepstakes gambling establishment 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 lawsuit, saying the settlement was made to prevent legal costs and continued litigation.

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

In the most recent suit, which is mostly comparable to its predecessors, New York state locals 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 sports betting business. '

Apple and Google have actually also been called as accuseds in suits for hosting the sweepstakes sites. But unlike VGW, neither tech company responded to DailyMail.com's ask for remark.

'We typically do not talk about matters before the courts,' a VGW spokesperson informed DailyMail.com via e-mail. 'However, we keep in mind that this claim has actually only just been submitted with the court and VGW has not been officially served.

'We have full self-confidence in our compliance with all laws and guidelines where we operate, and remain confident about the future,' the representative continued. 'We continue to use our free-to-play video games across the majority of North America, as we have for more than a decade, producing not just fantastic video games, user experiences and entertainment, however also guaranteeing this is done safely, responsibly and at the highest level of standards.

'More broadly, we 'd reiterate that class actions and other litigations and arbitrations are fairly typical across the online social video games industry (and the US more broadly), and our standard practice is that we mean to intensely defend any claim which may be brought against us.'

The issues between traditional online gaming and sweepstakes casinos could prove troublesome 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 video gaming titans like FanDuel and DraftKings.
bet9ja.com
'It's ironic that expert athletes are hawking unlawful sports betting 'sweeps' sites while at the very same time the leagues wish to forecast a strong stance versus illegal gambling - specifically when attempting to tamp down the occasional sports betting scandal,' Glaser informed DailyMail.com.

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

Together with VGW, Apple and Google are being demanded hosting presumably prohibited gambling websites

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

'I 'd expect that a league crackdown on professional athletes endorsing sweepstakes websites is a matter of when, not if,' Glaser added.

Neither an NBA representative nor the players' representatives responded to DailyMail.com's demands for remark. 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 explain to clients the differences and resemblances between iGaming and sweepstakes gambling establishments, VGW firmly insisted there is absolutely nothing more that needs to be done.

'We have full self-confidence in our influencer and ambassadorial collaborations, and our service practices more broadly,' the spokesperson stated. 'Some of our worths are" our players come first" and" we do what's right", and we put our worths at the core of whatever we do.'

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

'Celebrities who provide their names to dubious unlawful sports betting websites are, at a minimum, putting their track records at danger as well as courting civil and class actions by customers who declare damage,' Glaser stated. 'There is also some threat that state regulators and state attorney generals of the United States rope celeb endorsers into enforcement efforts for helping with illegal sports betting.'

New YorkNBADrakeParis Hilton