Man Sues Sweepstakes Casinos for Exploiting Gambling Addiction
Published:
Oct 10, 2025
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04:29 p.m.
ET
A new lawsuit is keeping sweepstakes casinos under the legal microscope. Matthew Joyce, a North Carolina resident with a documented gambling disorder, is suing two online sweepstakes platforms and a lending company for, by his account, alleged predatory practices designed to fuel his addiction. The case accuses the platforms of manipulating games, delaying withdrawals and showering Joyce with VIP perks to keep him playing. It also accuses a lender of extending high-interest loans that deepened his financial spiral.
The lawsuit exposes the murky legal space sweepstakes casinos occupy and adds to a growing list of concerns about whether these businesses are dancing around gambling laws at the expense of vulnerable players.
Details of lawsuit against sweepstakes casinos
Joyce’s complaint, filed in the U.S. District Court for the Eastern District of California, names ARB Gaming LLC (operating as Modo Casino), B2Services OU (operating as McLuck Casino) and Affirm Inc., the consumer lender.
The first allegation: exploitation of a known disorder. Joyce has a recognized gambling disorder, as well as bipolar disorder, anxiety and depression. Despite these red flags, the platforms allegedly encouraged his play with special promotions, elevated VIP “Black Diamond” status and personal hosts.
The second allegation: manipulated wins and losses. The lawsuit claims the casinos timed Joyce’s wins to occur before weekends, when withdrawals were unavailable, making it more likely he would gamble away winnings.
The third allegation: withdrawal barriers. Players must wait two business days for withdrawals, but can cancel requests in the meantime. Joyce alleges the casinos relied on this design, knowing compulsive gamblers were likely to reverse withdrawals and continue playing.
The fourth allegation: predatory lending. Affirm is accused of approving high-interest loans (many with annual percentage rates of 24–25%) that Joyce used exclusively for gambling. Even as his debts mounted, the loans kept coming.
The fifth allegation: failure to protect. Instead of offering meaningful responsible gambling tools, Joyce says the companies mocked his excessive play and only belatedly suggested limited safeguards.
Together, these practices allegedly cost Joyce significant sums of money and worsened his mental health. The lawsuit seeks damages, restitution of funds and punitive action against the defendants.
What are “sweepstakes” casinos? Are they legal?
Sweepstakes casinos are not traditional casinos, but their similarities are hard to miss. These platforms typically sell “virtual coins” for entertainment play, while offering “virtual cash” bonuses that can be wagered and converted into real money.
Under U.S. sweepstakes laws, platforms must provide a no-purchase-necessary option. For example, mailing in a request for free coins allows them to argue they aren’t technically gambling operators.
On paper, sweepstakes casinos are legal in most states because they offer free-entry methods. In practice, however, many players spend real money chasing wins, while responsible gaming protocols are largely absent. This model blurs the line between gaming and gambling.
The risk is clear: what looks like a low-stakes social game can quickly turn into a financial and emotional trap.
Some states cracking down on “illegal” sweepstakes gambling operators
Though sweepstakes casinos currently operate in over 40 states, regulators are beginning to push back. The American Gaming Association has called these platforms “unlicensed casinos” that bypass consumer protections and deny states tax revenue, and many states are beginning to take action:
Delaware, Georgia, Idaho and Washington have ordered major operators to shut down.
Michigan regulators issued cease-and-desist letters to sweepstakes casinos including Stake.us and Virtual Gaming Worlds.
New York cracked down in 2025, ordering 26 operators to end sweepstakes coin sales.
California introduced legislation to ban sweepstakes-based online casinos outright, though it faces heavy industry opposition.
Nevada and Montana have already passed prohibition bills, while Connecticut awaits its governor’s signature on a similar measure.
Other states remain permissive, allowing sweepstakes casinos to operate in legal gray zones.
Joyce’s case exposes the urgent need for stronger oversight. Without regulation, sweepstakes platforms can manipulate players while offering little in the way of responsible gaming measures or financial safeguards.
Support for people addicted to sweepstakes gambling
Sweepstakes gambling is a serious addiction with devastating consequences. While litigation may eventually hold certain operators accountable, thousands of others continue to market aggressively to young individuals already at risk for gambling addiction.
If you or someone you know is struggling with sweepstakes gambling, sports betting or related financial distress, professional help is available.
Birches Health offers expert, virtual care for individuals facing gambling addiction, sports betting problems or day-trading compulsions. Birches’ licensed clinicians specialize in helping clients regain control, repair relationships and restore financial stability.
Take the first step toward recovery with Birches Health today:
Call 833-483-3838
Email help@bircheshealth.com
