Baltimore sues sweepstake operators alleging illegal online gambling targeting residents
The City of Baltimore has launched a wide-ranging lawsuit against several companies behind popular online “social casino” platforms or sweepstakes, accusing them of operating illegal gambling businesses that pull in money from local residents while presenting themselves as harmless entertainment.
The complaint, reviewed by ReadWrite, was filed Wednesday (March 4) in the Circuit Court for Baltimore City. It names a group of well-known sweepstakes casino operators, including Chumba Casino, LuckyLand Slots, McLuck Casino, Pulsz Casino, Stake.us, High 5 Games, and Fortune Coins. City officials claim those platforms have taken millions of dollars from players in Baltimore through online casino-style games that Maryland law does not permit.
Maryland currently allows casino gambling only at six licensed brick-and-mortar casinos. State regulators have never approved real-money online casino games. The Maryland Lottery and Gaming Control Agency has repeatedly warned that the legal online options are extremely limited.
As regulators previously explained: “Sports wagering via licensed operators and online fantasy competitions offered by registered operators are the only legal online gaming options in Maryland. No other forms of real-money online/mobile gaming or wagering are operating legally in Maryland.”
Baltimore’s lawsuit argues that the companies are effectively running full casino operations on the internet despite that restriction. According to the city, the platforms host digital versions of familiar casino games such as slot machines, blackjack, roulette, and poker.
ReadWrite reached out to VGW, which is the parent company of Chumba Casino, LuckyLand Slots. However, a spokesperson said they would not comment on legal proceedings.
Baltimore explains how the “dual currency” sweepstakes system works
The business model commonly used across the sweepstakes casino industry is said to let players wager money directly, the platforms sell virtual currency.
Players typically buy digital tokens often called “gold coins.” The coins can be used for gameplay but cannot be redeemed for cash. At the same time, the platforms grant a separate promotional currency, frequently labeled “sweeps coins,” as a bonus when users make purchases or log in.
The sweeps coins can be used to play the same casino games and, according to the complaint, can later be redeemed for cash or prizes. Baltimore officials argue that this structure still meets the legal definition of gambling because players pay money for the chance to win something of value.
The complaint cites a letter from a Maryland gaming regulator stating, “These offerings contain the elements of gaming: consideration, chance, and prize. . . . In other words, it is gaming.”
City attorneys also argue the platforms blur the line between free games and real-money gambling. Many advertise themselves as “free-to-play” or “social entertainment,” the lawsuit says, even though players often must purchase currency to participate in any meaningful way.
Marketing practices are another focus of the complaint. According to city officials, companies promote their sites through influencer partnerships, social media advertising, and celebrity endorsements. Similar marketing tactics have been criticized in lawsuits filed in other states, including a Missouri case involving Stake.us promotions linked to major streaming personalities.
Defendants target youth through multiple, reinforcing vectors: gamified design elements drawn from mobile gaming popular with children and adolescents; advertising on platforms and through influencers with disproportionately young audiences; colorful, cartoonish visual branding that mimics children’s games; and age-verification systems so perfunctory that they function as no barrier at all.
City of Baltimore vs VGW et al.
The Baltimore filing also claims the games are designed to resemble mobile apps popular with younger audiences, using bright colors, cartoon-style graphics, and animated characters. Officials argue those design choices make the platforms especially appealing to minors.
Age verification procedures are another concern raised in the complaint. Instead of confirming a user’s identity, the sites typically rely on a self-reported birthdate or a checkbox confirming the player is over 18.
Baltimore’s lawsuit arrives as scrutiny of sweepstakes casinos grows across the United States. Civil lawsuits have recently been filed against operators in several states, including Alabama and Louisiana, while regulators in Maryland have already issued cease-and-desist orders to certain gaming platforms accused of offering unauthorized casino-style play.
The lack of regulatory oversight presents many risks for consumers as well as the integrity and economic benefits of the legal gaming market through investment and tax contributions. These sweepstakes-based operators have weak (if any) responsible gaming protocols and few, if any, self-exclusion processes.
American Gaming Association
Industry critics such as the American Gaming Association say these cases reflect mounting pressure from lawmakers and regulators who believe sweepstakes casinos are exploiting legal loopholes to operate in states where online casinos remain illegal.
Through the lawsuit, Baltimore is seeking civil penalties, restitution for consumers, and a court order preventing the companies from continuing to operate in the city or accept transactions from local players. The complaint also asks the court to force the companies to surrender profits earned from what officials describe as unlawful gambling activity.
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