Tennessee Gov. Signs Sweepstakes Casino Ban Into Law

Tennessee Bans Sweepstakes Casino Games

Gov. Bill Lee signed Senate Bill 2136 into law on 22 May. Lawmakers passed the bill earlier this month before sending it to the governor. The law targets casinos that use two kinds of virtual currency. Players could buy one type with real money. The second type came from bonuses, rewards, or promotions.

Players used both currencies to access games like slots, poker, bingo, and table games. Some prizes could later become cash or similar rewards. Lawmakers said these systems looked too much like normal gambling. Supporters of the ban also said some users may not understand the risks.

Under the new law, companies cannot run or promote these casinos in Tennessee. The law also blocks unlicensed sports betting linked to sweepstakes systems. Some gaming products are still legal in the state. These include:

• Legal online sports betting

• Fantasy sports contests

• The Tennessee Education Lottery

• Nonprofit gaming events

• Free-to-play casino games

State Officials Get More Power

Attorney General Jonathan Skrmetti will lead most enforcement actions under the new law. Violations will count as breaches of the Tennessee Consumer Protection Act. This gives officials broad civil powers without criminal charges. The law also expands investigation powers in future cases.

Officials can request written statements, question witnesses under oath, and inspect records linked to investigations. In December, his office sent cease-and-desist letters to nearly 40 sweepstakes casino operators. Officials said the companies were offering illegal gambling products to Tennessee residents.

Soon after, many operators removed games or prepared to leave the state. “The only thing you can be sure about with an online sweepstakes casino is that it’s going to take your money,” Skrmetti said during the earlier crackdown.

More States Follow Similar Rules

Tennessee now joins several states that have already banned sweepstakes casinos. These include California, Connecticut, Indiana, Iowa, Maine, Montana, New Jersey, and New York. Montana became the first state to pass a direct ban last year. The law started in October 2025.

Officials in Illinois and Minnesota have also taken action against operators by using older gambling laws. Many Tennessee users may not notice a big change. Several large sweepstakes casinos, including Stake.us, High 5 Casino, and RealPrize, had already stopped operating in the state months earlier.

Still, the new law marks another step in the growing debate over sweepstakes gaming in the United States.