For VGW and other lottery activity operators, it's a time of both challenges and changes. Regulatory bodies in Louisiana and Mississippi, two major gambling hubs, have issued cease and desist orders to several online gambling and lottery websites suspected of illegal operations, totaling over 50 orders, directly targeting several brands under Australia's gambling giant VGW Holdings, including Chumba Casino, LuckyLand Slots, and Global Poker.
After the Louisiana Gaming Control Board's comprehensive ban on lottery activities was vetoed by the governor, the board quickly initiated enforcement actions, issuing a shutdown order to VGW and its affiliated websites. The chairman of the board, Chris Herbert, explicitly stated that this move highlights the state's zero-tolerance policy towards illegal operators, with the protection of citizen safety and industry fairness being paramount. Previously, the Social and Promotional Games Association and the Social Games Leadership Consortium welcomed the governor's veto, arguing that legal social games should be protected and calling for the establishment of a licensing framework. However, the regulatory stance is firm and clear.
Mississippi has also taken a tough stance, clearly stating that there are no legal online gambling and lottery activities in the state. Free games on related platforms that involve pay-to-win random elements are considered gambling. Jay McDaniel, the executive director of the Mississippi Gaming Commission, stated that he is actively cooperating with law enforcement to track down illegal operators, cut off tax revenue losses, and protect the local market.
Meanwhile, the New York State legislature also quickly followed up, passing a new bill to ban lottery-type games in a short period. If signed by the governor, New York will become another state, following Montana, Connecticut, and Nevada, to implement a ban on lottery activities. Earlier this year, the New York Attorney General issued cease and desist orders to several lottery websites, including VGW's Chumba, LuckyLand, and Global Poker, forcing VGW to announce its withdrawal from the New York lottery market. The chairman of the state gaming commission, Brian O'Dwyer, expressed support for this, emphasizing the importance of protecting consumers from illegal gambling markets.
Additionally, VGW has also faced investor scrutiny over financial reporting issues this month, with founder Laurence Escalante publicly responding, urging dissatisfied shareholders to sell their shares, making the company's situation even more challenging.
Overall, the crackdown on online lottery and gambling platforms in several major gambling states in the US is intensifying, the regulatory environment is becoming stricter, and the compliance pressure and market risks facing VGW and similar operators are significantly increasing.
