Iowa Bill Would Expand Enforcement Power Against Unlicensed Gambling Sites

Iowa lawmakers are weighing a change that could reshape how the state responds to unlicensed gambling activity. A new proposal would give regulators clearer authority to act against operators that currently sit outside the licensed system.

Supporters say the goal is stronger enforcement, while critics watch closely for how broadly the power could be applied.

Good to Know

• Iowa lawmakers introduced HSB586 to expand enforcement authority
• The bill allows civil penalties and court action against unlicensed gambling operators
• Sweepstakes casino platforms appear to be a primary focus

A bill introduced in the Iowa General Assembly would expand the authority of the Iowa Racing and Gaming Commission, allowing the agency to pursue civil penalties against unlicensed gambling operators. The proposal, known as HSB586, has a companion measure in the Iowa Senate. Both bills currently sit in committee.

Under current law, the commission regulates licensed casinos and sports betting platforms but lacks clear authority to take direct action against unregulated operators. HSB586 would close that gap by granting enforcement powers tied to state gambling law.

Focus Turns to Sweepstakes Gambling

The language of the bill suggests sweepstakes casino platforms could face increased scrutiny. The proposal authorizes the commission to seek injunctions, issue cease and desist orders, and pursue other enforcement measures against operators offering games of chance, gambling, sports wagering, or illegal sweepstakes without proper authorization.

The bill states that the commission would gain authority “to take any other action as may be reasonable or appropriate to enforce this chapter and the commission rules, including but not limited to issuing cease and desist orders and obtaining injunctive relief against a person offering games of chance, gambling, sports wagering, or illegal sweepstakes in this state without holding an appropriate license issued by the commission or otherwise being specifically authorized by law.”

Lawmakers have not limited the scope solely to sweepstakes platforms. The expanded authority could also apply to illegal sports betting websites operating without approval inside Iowa.

Iowa collected roughly $19 million in sports betting tax revenue during 2025. Supporters argue stronger enforcement protects both consumers and licensed operators who already comply with state rules.

Iowa Joins Growing National Trend

If enacted, Iowa would follow a growing list of states taking action against sweepstakes gambling platforms. Tennessee attorney general recently issued 40 cease and desist letters to sweepstakes operators active in that state.

Earlier last month, lawmakers in Maine and Indiana introduced legislation aimed at blocking sweepstakes casino operations. A Florida lawmaker has also filed a bill to ban the platforms after a similar attempt failed last year.

Several states have already moved forward with restrictions. California approved a ban in October. New Jersey Governor Phil Murphy signed legislation banning sweepstakes gambling in August. Additional efforts remain active in Maryland, Mississippi, Virginia, Oklahoma, and Utah.

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