Florida AG Sues VGW, Stake, Payment Firms in Blistering Attack on Sweepstakes Casinos

Sweepstakes casinos are a “gateway drug” to real money gambling, according to Florida Attorney General James Uthmeier, who filed two separate lawsuits Wednesday (August 19) against operators VGW and Stake.

The complaints seek to shut down the companies’ operations in Florida and recover allegedly ill-gotten gambling proceeds, along with consumer restitution and civil penalties.

Also named in the suits are payment processors accused of facilitating sweepstakes transactions, including Breeze Labs, Praxis, Trustly, and Worldpay.

“They call them ‘sweepstakes’ casinos as if that’s some sort of talismanic cure-all,” he continues. “But if it looks, swims, and quacks like a duck, it’s a duck. The VGW Defendants’ ‘sweepstakes’ casinos violate Florida laws, harm Florida citizens, and deprive the State of licensing, taxation, and other revenues from gambling entities that the State properly regulates.”

Dark Alley

Of Stake, he writes that the company uses “the idea of safe ‘social gaming’ and celebrity endorsements to bring consumers into their storefront, only to then push them out the backdoor, into the dark alley where their illegal, unlicensed real money gambling operations occur.”

Stake co-founders Ed Craven and Bijan Tehrani are named individually, with Uthmeier alleging they personally participated in and controlled the company’s marketing and expansion strategy.

Uthmeier argues that online sweepstakes companies market themselves as “free,” “100% safe,” and “100% legal” but have in fact “engaged in business practices that skirt, evade, or ignore the laws of Florida to swindle Floridians out of their hard-earned money.”

How Sweepstakes Work

Sweepstakes casinos use a dual-currency system that operators argue keeps them on the right side of gambling laws.

Players buy virtual Gold Coins that have no cash value and receive a second, redeemable currency — typically called Sweeps Coins — as a free bonus.

Because the redeemable currency is technically given away rather than sold, and can also be obtained without making a purchase, operators contend players are participating in a promotional sweepstakes rather than gambling.

Uthmeier argues the distinction is a legal fiction, and that consumers are effectively buying casino chips by another name.

Nationwide Backlash

California, Connecticut, Indiana, Louisiana, Maine, Montana, Nevada, New Jersey, New York, and Tennessee are among states to have enacted laws targeting the model since 2025.

Other states, including Michigan and Washington, have used existing gambling laws to force operators from their markets.

Florida lawmakers considered legislation earlier this year that would have strengthened the state’s prohibition on internet gambling.

House Bill 591, introduced by Rep. Berny Jacques, died in committee when the legislative session ended in March.

Uthmeier’s lawsuits effectively argue that no new law is necessary because the sweepstakes casino model already violates Florida’s existing gambling statutes.

“These actions threaten vulnerable Floridians, including children and seniors, and cause Floridians to lose substantial amounts of real money – all while Defendants reap enormous, illicit, ill-gotten gains at their expense,” he writes.