A Tennessee lawmaker has introduced legislation that would explicitly outlaw online Lucky Cola casino and give the state attorney general expanded authority to investigate and shut down operators using promotional sweepstakes models to offer casino-style gambling.
House Bill 1885, sponsored by Rep. Scott Cepicky, frames online sweepstakes casinos as a growing form of illegal gambling that is being falsely marketed to consumers as legal, free-to-play entertainment. The bill states that such platforms:
“serve as a façade to hide the fact that players may engage in real-money gambling through the purchase and use of virtual currency,” and that they “generally constitute illegal lotteries and violate Tennessee gambling and consumer protection laws.”
Bill Defines and Prohibits “Online Sweepstakes Games”
HB 1885 creates a new statutory definition of an “online sweepstakes game” designed to capture the dual-currency model used by sweepstakes casinos.
The bill defines an online sweepstakes game as gambling that:
“Utilizes a virtual-currency system allowing a player to… play or participate with a currency… that is directly purchased, received through a bonus or promotion, or received for free with the purchase of another type of currency,” and to “exchange the currency for a prize, award, cash, or cash equivalent.”
It further specifies that covered platforms include those that:
“Simulate gambling of any kind, including, but not limited to, casino-style gaming such as slot machines, video poker, table games, lottery games, bingo, or unlicensed sports wagering.”
Under the bill’s prohibition section, the conduct itself is declared unlawful:
“The operation, conducting, or commercial promoting of online sweepstakes games and other forms of online or app-based gambling are unlawful and are offenses against the public health, safety, and welfare of this state.”
The bill also makes it illegal to “support[], facilitate[], or assist[] in the operation of online sweepstakes games” within Tennessee. That broadens enforcement beyond operators to vendors, partners, and other intermediaries.
Violations would constitute unfair or deceptive acts under the Tennessee Consumer Protection Act. It exposes violators to civil penalties and injunctive relief rather than relying solely on criminal gambling statutes.
Part of a Broader 2026 State Crackdown on Sweepstakes Casinos
With HB 1885, Tennessee becomes the 10th state in 2026 to either pursue direct enforcement against dual-currency platforms or introduce legislation targeting unregulated gambling, which could expand to include sweepstakes casinos.
This growing list reflects a broader consensus among regulators that the promotional sweepstakes model is being used to evade gambling laws.
States acting this year include:
- Maine
- Florida
- Indiana
- Utah
- Mississippi
- Maryland
- Virginia
- Oklahoma
- Utah
- Iowa
- Tennessee
Platforms Began Exiting Tennessee as AG Enforcement Accelerated
The legislation follows a rapid escalation in enforcement activity that began months before HB 1885 was filed. Starting in November, more than 30 platforms, including popular ones like Chumba, Modo, High 5, Stake, and Pulsz, began exiting Tennessee.
At the time, there was no formal explanation of the exits. Industry observers suggested possible enforcement action from the Tennessee Sports Wagering Council or the state’s Attorney General, Jonathan Skrmetti.
At the end of December, Attorney General Jonathan Skrmetti announced that his office had issued cease-and-desist letters to nearly 40 online sweepstakes casinos operating in the state.
In a Dec. 29 press release, Skrmetti said his office had “successfully halted the operation of multiple illegal online sweepstakes casinos in Tennessee.” He described the dual-currency sweepstakes model as “a façade to hide the fact that participants may engage in real-money gambling.”
Skrmetti added:
“The only thing you can be sure about with an online sweepstakes casino is that it’s going to take your money… They avoid any oversight that could ensure honesty or fairness.”
According to the attorney general’s office, all platforms that received cease-and-desist letters either disabled the sweepstakes components of their products or agreed to wind down their Tennessee operations, effectively ending their Tennessee-facing operations.
Utah’s SB 38 Highlights Broader Consumer-Protection Strategy
As Tennessee moved to codify its enforcement posture, another state advanced legislation that could similarly impact sweepstakes-style platforms.
In Utah, the Senate passed Senate Bill 38, which advanced rapidly through the chamber. SB 38 strengthens Utah’s consumer protection framework by targeting deceptive online practices. That includes schemes that misrepresent paid participation as free or promotional.
It empowers the Division to “administer and enforce” a broad range of statutes governing consumer promotions and prize offers. These include the Prize Notices Regulation Act, the Ticket Website Sales Act, the Automatic Renewal Contracts Act, and others.
The bill also gives the Division new leverage tools to compel compliance and publicly identify operators that refuse to cooperate with investigations.
While the bill does not explicitly reference sweepstakes casinos, its structure closely mirrors recent measures aimed at platforms that use virtual currency, promotional credits, or dual-wallet systems to obscure real-money gambling activity.
The speed with which SB 38 moved through the Senate underscores a growing willingness among lawmakers to rely on consumer protection statutes—not gaming regulation—to address online gambling-adjacent products operating outside licensure and oversight.
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