Gaming attorney Daniel Wallach was among the first to break the news.

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"New York Senate Committee passes bill to prohibit online sweepstakes casinos and revenue from illegal markets. @SenJoeAddabbo
’s S5935 to crack down on sweepstakes gaming passed unanimously in the NYS Senate Racing, Gaming & Wagering Committee. (h/t @hglaser1).

It's not a done deal just yet as the bill still has to make its way through to the finish line.  New York is one of the states mulling legalization of iGaming.

At least seven states now have active legislation targeting online sweepstakes operators with prohibitions on the unregulated gambling-like activities:

    Connecticut
    Florida
    Maryland
    Mississippi
    Nevada
    New Jersey
    New York

Senator Joseph Addabbo, the Chair of the New York State Senate Racing, made it abundantly clear heading intp the new legislative session, he was making it his mission to eradicate sweepstakes casinos in The Empire State.

“One of my primary objectives as Gaming chair is ensuring New Yorkers are protected from gambling operations that have the potential of becoming more problematic without proper legislative action, such as unregulated sweepstakes casino operators,” stated Addabbo.

“Many sweepstakes' operators are located offshore making enforcement limited or impossible, and our most vulnerable populations, youth and elderly, are most often targeted, which is why I want to act to address this existing loophole,” Addabbo added. The Senator expressed that the sweepstakes operators are allowing individuals to pay for virtual coins and win more coins that can be redeemed for cash prizes. “The use of money to play a game and win more money is simple gambling and should be safely regulated.

"When individuals play Sweepstakes Coins games, they can win more, and when they accumulate a required minimum amount of Sweepstakes Coins, they can be redeemed for cash prizes. The process of turning your winnings into prizes like gift cards or even cash prizes can differ from site to site but often involves a similar path. Ultimately, individuals are spending money to purchase coins in exchange for a prize.

“To close this loophole, I will work to ban or incorporate Sweepstakes Casinos in the state, akin to current laws in Michigan, Idaho, and Washington, and I will push for iGaming as a safe, effective alternative for online casino enthusiasts,” Addabbo explained. “By addressing the Sweepstakes Casinos issue and allowing a regulated iGaming casino option, we are demonstrating our commitment to protecting New Yorkers, dealing with gaming addiction, while adding tax revenue beneficial to all state residents,” Addabbo explained. “Without an option for safe, regulated online gaming, many individuals will fall victim to sweepstakes casinos that entice customers through free play advertising with the potential for prizes through the purchase of gold coins,” added Addabbo. “I encourage my colleagues and the Governor to take action against unregulated sweepstakes casinos, while reconsidering the benefits of allowing legal iGaming operators to provide sanctioned services in a popular and ever-growing industry,” concluded Addabbo.