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Sweepstakes Casinos / Sweepstakes Magazine / VGW Withdraws from Michigan Amidst State's Unlicensed Gaming Crackdown

VGW Withdraws from Michigan Amidst State's Unlicensed Gaming Crackdown

Publish Date:06/11/2023
Key Points
  • VGW exits Michigan due to the state's crackdown on unlicensed gaming sites.
  • VGW players can use existing balances until February 1, 2024.
  • Sweepstakes casinos under scrutiny as states enforce gaming laws.


Online Casino

Operators of sweepstakes casinos are under pressure to abide by state gaming rules and are coming under more regulatory scrutiny. Recently, there was an announcement by Virtual Gaming Worlds (VGW), the company behind Chumba Casino, Global Poker, and Luckland Slots, that it would no longer be taking new customers from Michigan. Also, following a two-year probe, Michigan Attorney General Dana Nessel issued an order for Golden Hearts Games to stop doing business in the state. Michigan gamers will no longer be accepted into the social casino.

Sweepstakes Casinos and Unregulated Gaming Sites Face Regulatory Pressure

The operator of multiple sweepstakes casino brands, Virtual Gaming Worlds (VGW), has declared that it would no longer take new players from Michigan. This action was just born in line with Michigan authorities' crackdown on unlicensed gambling sites that are present in the state. VGW has said unequivocally that this choice results from its continuous efforts to assess its business practices and conform to the demands of its stakeholders.

Many states in the United States allow users to access VGW's portfolio of well-known social gambling brands, which includes poker sites and sweepstakes casinos.

With Idaho and Washington being the other two states without VGW, Michigan is now the third state in the union.

The company released a statement, "After careful consideration, VGW has decided to take this course of action. We continually evaluate our business operations in the interests of all their stakeholders."

Players of VGW will be able to use their current balances till the end of the month. The deadline for players to redeem any outstanding rewards is February 1, 2024.

VGW's Exit from Michigan and the Impact on Players

The departure of VGW from Michigan serves as a warning about challenges that other social casinos may have in the future. The landscape for social casinos gets increasingly hazy as more states begin to regulate real-money online casino gaming. Advocates contend that these operators offer a safer option to unregulated offshore operators than authorised real-money internet casinos in areas where they are not allowed. Still, regulators are trying to plug any legal gaps in the gaming legislation.

According to the company's decision, there will be significant changes for Michigan-based VGW players. They won't be able to purchase coins on VGW sites starting on November 1, 2023. They can still use their current amounts, though, till December 1, 2023. Players must claim any outstanding awards by February 1, 2024, or they will be forfeited.

Unregulated gaming sites - Taking a closer Look

Magnifying glass

Operators of sweepstakes casinos are under pressure to abide by state gaming rules and are coming under more regulatory scrutiny. These online casinos use virtual money that has no inherent value in currency. The operators have tried to avoid being discovered by gaming authorities in this manner. To improve their gameplay, players can and do invest actual money. Additionally, websites give out cash and other prizes with a monetary worth, such as gift cards.

Although these platforms function differently, they provide an alternative in states without licensed real-money online casinos. Social casinos use their virtual currency, which is not valuable, instead of regular casinos that deal in US dollars.

Unlike their regulated counterparts, unregulated gaming sites do not pay state taxes. Players who have problems with an unlicensed gaming website have limited legal options at this time. Therefore, there may be additional hazards for users of sweepstakes casinos. Some authorities are beginning to crack down on operators as a result.

“Unlicensed gaming robs our schools and government of essential funding and leaves consumers unprotected. These companies circumvent Michigan’s gaming laws and thus create the false impression that their games are legal and safe for consumers. " Nessel said.

She further reassured that her office is committed to ensuring the State's gaming laws are strictly enforced and violators will be punished accordingly.

Wrapping Up

The withdrawal of VGW from Michigan provides an analysis of how the online gaming industry is changing and how legislative changes affect social casinos. Operators in this industry are coming under more scrutiny as states like Michigan adopt harsher policies on unlicensed gambling sites. Players, on the other hand, have to adjust to the new regulations and limitations as the environment changes.

State authorities target more than just sweepstakes casinos. The Michigan Gaming Control Board decided to outlaw Pick'em fantasy sports items just recently. North Carolina, Florida, and Ohio have all opposed Pick'em. Maine, however, recently ordered Underdog Sports to stop selling its Pick'em product in the Pine Tree State and penalised another operator a heavy sum of money.

Watch this space for updated information on all happenings in the sweepstakes casino industry.

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