Attorney General Letitia James says VGW to pay $8M for breaking state wagering laws

The owner of Chumba Casino, Global Poker, LuckyLand Slots and other online gambling sites has agreed to pay $8 million in penalties for breaking New York State's gaming laws.

Separately, VGW Holdings Ltd. will repay consumers seeking reimbursement of the value of the "sweeps coins" in their account as of June 2, 2025, according to an agreement reached between state Attorney General Letitia James and the company.

Australia-based VGW, also called Virtual Gaming Worlds, stopped using "sweeps coins" in its games in New York on June 2, 2025, after receiving a "cease and desist" letter from James’s office about five weeks earlier.

James announced the settlement on Wednesday, saying state law prohibits online gambling that involves consumers risking something of value, including redeemable sweepstakes coins. The VGW platforms offer craps, blackjack, roulette and other casino games in which consumers play using the coins that then can be redeemed for cash or prizes, she said, citing her office’s investigation.

Gov. Kathy Hochul signed a bill into law banning online casino sweepstakes such as those run by VGW late last year.

James said in a statement on Wednesday: "Online sweepstakes casinos like Chumba Casino, Global Poker and LuckyLand Slots posed a dangerous threat to New Yorkers and their financial and mental health. My office took action to stop these illegal platforms last year, and now we are holding VGW accountable for the damage done."

She estimated some New Yorkers lost tens of thousands of dollars playing VGW’s games.

VGW, in a statement from spokesperson Michael Bennet, said it would continue to offer games in New York "solely through Gold Coins play," where customers don't exchange the coins for cash or gift cards.

VGW also said its agreement with the attorney general is "not intended, and should not be construed, as an admission of liability."

In June, Kentucky’s attorney general, Russell Coleman, sued VGW alleging its use of virtual coins is an illegal sweepstakes casino under Kentucky law. In March, Baltimore filed suit alleging VGW targeted young people to be customers and violated Maryland’s gambling laws.

Last year, Delaware’s Division of Gaming Enforcement found that VGW’s operations violated that state’s constitution.

In New York, the attorney general’s action against VGW began in June 2025 when 25 online gambling sites from various companies were ordered to cease operating in the state.

"These so-called ‘sweepstakes’ games are unscrupulous, unsecure and unlawful," Brian O’Dwyer, chairman of the New York State Gaming Commission, said at the time.

Investigators from the attorney general’s office determined VGW permitted players to obtain "sweeps coins" the same way one purchases chips in a casino, receiving one coin for every $1 spent on the platform. The company said the coins were provided for free, so no gambling was taking place.

VGW entered the New York market in 2012 with its Chumba Casino site, followed by its Global Poker site in 2016 and LuckyLand Slots in 2018, according to the 11-page settlement.

The settlement also states that VGW customers have one year from Aug. 31 "to submit a request to redeem sweeps coins that were in their customer’s account with [VGW] as of June 2, 2025. In response to each valid request, [VGW] shall redeem the customer’s sweeps coins."

In July, VGW’s founder and longtime CEO, Laurence Escalante, stepped down after police in Perth, Australia, arrested him on charges of assaulting his former girlfriend, stealing jewelry and damaging a handbag he had given her. He also was charged with drug possession.

The 44-year-old billionaire didn’t immediately enter a plea but has been released on bail, according to Australian news media reports.

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.