Drake has been accused of participating in a racketeering conspiracy built around the online casino Stake. A class action lawsuit filed in Virginia this week argues that Stake is running an illegal gambling operation in the United States, in which Drake, who is paid to promote the platform, is complicit. It further alleges that he is funnelling proceeds—via Stake’s unregulated “tipping” system—to a third party, in Australia, to invest in bot farms that illegally boost Drake’s streaming numbers. Stake’s parent company, Sweepstakes Ltd., is named as a defendant alongside Drake, the streamer Adin Ross, and George Nguyen, the alleged Australian co-conspirator.
The basis of the lawsuit is that Stake operates in U.S. states, such as Virginia, that have outlawed real-money online gambling. Eyeing a possible (and highly contentious) legal loophole, Stake circumvents the online-gambling ban by selling “play money” that comes with free tokens. While the play money is worthless, the tokens can be wagered and later converted into cash for withdrawal. If a judge deems the practice to be illegal, Drake and Ross could be liable for promoting Stake.us, even if their own areas of residence permit online gambling.
Founded in Australia in 2017, Stake is a multibillion-dollar company whose fortunes skyrocketed during the cryptocurrency boom. It signed an endorsement deal with Drake in 2022 worth a reported $100 million a year; he has since undertaken frequent livestreams of online gambling sessions and giveaways. This past August, Drake seemingly fell out with the platform after having withdrawal attempts blocked. The matter appeared resolved in October when he posted a video staging his discovery of a $1 million balance restored to his account.
The bot-farming aspect of the lawsuit doubles as an attack on Stake’s “tipping” function, which allows users to transfer funds between accounts—a common feature of online casinos. The lawsuit claims that Drake, Ross, and Nguyen used the feature to covertly transfer gambling proceeds. That “wholly unregulated money transmitter,” the lawsuit adds, financed Nguyen’s further promotion of Stake, as well as a campaign to artificially boost Drake streams and “fabricate popularity; disparage competitors and music label executives; [and] distort recommendation algorithms.” This scheme, the lawsuit alleges, is carried out on platforms such as Spotify and “has suppressed authentic artists and narrowed consumers’ access to legitimate content.”
Two plaintiffs, LaShawnna Ridley and Tiffany Hines, filed the class-action lawsuit on behalf of those affected in Virginia, claiming Drake’s promotion helped lure them onto Stake. They are seeking at least $5 million in damages, based on two violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act and one of the Virginia Consumer Protection Act. This is not the first lawsuit alleging that the platform is breaking U.S. gambling laws, or even the first implicating Drake: A Missouri complaint filed last October alleges that Drake and Ross misrepresented Stake.us as a harmless “social casino,” rather than an illegal gambling platform. That suit claims Drake and Ross further mislead their followers by hosting gambling livestreams directly funded by Stake, rather than out of their own pockets.
