New York AG James Warns Consumers on Prediction Markets
Posted on: February 2, 2026, 04:01h.
Last updated on: February 2, 2026, 04:01h.
- She says prediction markets lack same protections as regulated betting avenues
- James adds prediction markets are essentially unregulated gambling outlets
Just days before Super Bowl LX, New York Attorney General Letitia James (D) is warning Empire State consumers about the risks associated with prediction markets.
In a consumer alert released this afternoon, James notes event contract platforms have no consumer protections and operate outside the purview of the New York State Gaming Commission (NYSGC). Prediction market operators are regulated at the federal level by the Commodities Futures Trading Commission (CFTC).
Ahead of the Super Bowl, New Yorkers need to know the significant risks with unregulated prediction markets,” said the attorney general in the alert. “It’s crystal clear: so-called prediction markets do not have the same consumer protections as regulated platforms. I urge all New Yorkers to be cautious of these platforms to protect their money.”
The Super Bowl is the most wagered on event in the US and some analysts have noted prediction market operators are likely to eat away at the handle long dominated by sportsbook rivals during this year’s edition of the NFL premier contest.
James Takes Shots at Prediction Markets Industry
Helped by its status as the fourth-largest state by population and the largest state with a competitive sports wagering market, New York consistently posts the largest handle of any US jurisdiction, meaning sports betting is generating millions of dollars for state coffers.
Recent data indicate that despite soaring volume on platforms such as New York-based Kalshi, regulated sports wagering handle in New York hasn’t suffered in material fashion. However, James isn’t shy about warning event contract platforms about their increasing flirtation with what many experts believe to be sports betting.
In the consumer alert, the attorney general warned prediction market companies that advertising and promotion of what appears to be sports betting runs afoul of New York gaming laws and could be subject to civil and criminal prosecution. She also chided the industry for positioning itself as an investing alternative when, in her view, it’s another avenue for wagering.
“Prediction markets may appear as modern, high-tech platforms for speculation or ‘forecasting,’ but in practice, many operate as unregulated gambling without the basic protections New York consumers both deserve and expect from properly licensed operators,” according to the alert.
Kalshi, New York Already Engaged in Legal Battle
New York is on the increasingly long list of states pursuing some form of legal or legislative action prediction market companies. Last October, the NYSGC issued a cease-and-desist order to Kalshi on the grounds that company was offering an unlicensed sports betting product.
Kalshi fired back with a countersuit, citing its status as a federally regulated entity — a tactic it’s used in multiple states, though the company and some competitors are losing many state-level challenges.
On a related note, Massachusetts recently granted Attorney General Andrea Campbell (D) a preliminary injunction against Kalshi and that ruling has been added by the NYSGC as supplemental authority in its case against the event contracts firm.
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