California Assembly Bill 831 (AB 831), enacted in 2025-2026, significantly modifies the state’s regulations concerning sweepstakes and online gaming. The law expands the definition of prohibited activities, clarifying what constitutes simulated gambling, and strengthening enforcement.
The bill specifically targets the use of online platforms or applications to simulate gambling, whether through websites or apps. This includes any method that offers prizes or cash equivalents based on a simulated gambling experience. The legislature sought to eliminate ambiguity in existing law, aiming for a clearer definition of prohibited practices.
AB 831 explicitly prohibits the use of online methods to simulate gambling, even if it doesn’t involve traditional gambling-themed games. The new law includes examples such as lottery games, bingo, and sports wagering to illustrate the types of simulated gambling it prohibits.
The bill also broadens the scope of responsibility beyond the operators of these games. Financial institutions, payment processors, geolocation providers, gaming content suppliers, platform providers, and media affiliates can face legal consequences if they knowingly support illegal online sweepstakes operations.
Violations of AB 831 are classified as misdemeanors, punishable by significant fines (between $1,000 and $25,000) and/or imprisonment. The state intends to enforce these penalties rigorously to deter illegal online sweepstakes operations.
However, the legislation includes exemptions. Legitimate gambling enterprises licensed under the Gambling Control Act, along with the California State Lottery, are not affected. Additionally, limited and occasional sweepstakes conducted by for-profit businesses as part of their advertising and marketing efforts remain permissible, provided they are genuinely incidental to sales and not designed to establish ongoing gambling.
The bill addresses potential financial implications for local governments. It specifies that no state reimbursement is required for costs incurred by local agencies or school districts due to the implementation of AB 831. This provision reflects a specific legislative decision regarding cost allocation.
In summary, AB 831 represents a significant update to California‘s regulations on sweepstakes and online gaming, clarifying existing prohibitions and establishing stricter penalties for violations. The law aims to curtail illegal online gambling activities while preserving legitimate business practices and exempting established gambling operations.
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