New York Sues Kalshi For Running 'Illegal Gambling Operation' (cnbc.com)
- Reference: 0184791662
- News link: https://yro.slashdot.org/story/26/07/31/1628208/new-york-sues-kalshi-for-running-illegal-gambling-operation
- Source link: https://www.cnbc.com/2026/07/31/new-york-sues-kalshi-claims-it-is-illegal-gambling-operation.html
> In a [3]case filed in a Manhattan state court (PDF), the lawsuit claims that Kalshi accepts wagers as a gambling business in disregard for the state's constitution and laws by not being registered with the New York State Gaming Commission. Governor Kathy Hochul in the press release said the state is taking the action to stop what it views as illegal behavior and bring the company into compliance with New York law. The lawsuit is seeking a permanent injunction against Kalshi.
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> The suit by the state is also seeking a total restitution to users who have placed trades on the platform, a $100,000 penalty for each attempt to offer sports wagering, and another penalty three times the amount the company has gained while allegedly operating in violation of New York law. The state estimates that could total $36 billion.
[1] https://www.cnbc.com/2026/07/31/new-york-sues-kalshi-claims-it-is-illegal-gambling-operation.html
[2] https://ag.ny.gov/press-release/2026/governor-hochul-and-attorney-general-james-announce-new-york-has-sued-kalshi
[3] https://ag.ny.gov/sites/default/files/court-filings/new-york-v-kalshiex-llc-petition-2026.pdf
In That Case... (Score:2)
...I've got 3:1 on NY winning! C'mon folks, $10 will get you $30! $100 will get you $300!
What About CFTC Ruling (Score:2)
Didn't the CFTC just declare prediction markets, like Kalshi et al, to be contract markets and swaps, and that states did not have authority to regulate them as they were under CFTC jurisdiction?
So, is this a new angle or is this some BS posturing on New York's on a matter that has already been decided?
And what about the hypocrisy with them permitting Draft Kings, FanDuel, and other sports betting sites?
Re:What About CFTC Ruling (Score:4, Informative)
IANAL but the primacy clause doesn't automatically remove regulatory authority from the states. Also, imo, prediction markets should already be illegal in new york under new york's anti bucket shop law from the early 20th century.
Re: (Score:2)
That's what they're trying to claim, yes.
It's not a flawless argument, however. At it's broadest, [1]a swap could basically refer to any financial transaction whatsoever [cornell.edu]. Courts generally frown on such promiscuous definitions, however, and the CFTC and SEC have both issued several clarifications on how they interpret that - For example, they don't consider insurance as a swap, even though by any reasonable interpretation insurance is absolutely a form of swap, and the way swaps are used in practice (prior to
[1] https://www.law.cornell.edu/definitions/uscode.php?def_id=7-USC-3543443-1747086273
Re: (Score:1)
> And what about the hypocrisy with them permitting Draft Kings, FanDuel, and other sports betting sites?
Hypocrisy? You mean the gambling operators licensed in New York State and not claiming to not be gambling operations?
[1]https://gaming.ny.gov/sports-w... [ny.gov]
[1] https://gaming.ny.gov/sports-wagering#licensed-operators
FWIW, Kalshi and Polymarket are both based in NYC (Score:3)
Specifically, in Manhattan. So AG James isn't playing favorites based on Kalshi's location.
Where's my cut!? (Score:2)
NY: "By ignoring our laws, Kalshi is running an illegal operation and harming New Yorkers in the process."
Kalshi: "Our mistake NY, here's your cut of the fleecing... I mean, profits."
NY: "We stand corrected. By following our laws, Kalshi is running an exemplary operation and enriching the lives of New Yorkers everywhere!"
Re: (Score:2)
If the laws are already on the books what’s the problem with them being enforced?
Re: (Score:2)
Yes but also no.
The regulation isn't about "taking a cut", but primarily about financial crimes like money laundering and insider trading. Generally there are age requirements, as minors can't buy stocks or enter into futures contracts, though custodial accounts where the minor is authorized to use it are allowed. Every transaction is also associated with registered brokerage companies, every transaction tied to a taxpayer ID and account information. To participate the government requires documentation wi
Wall Street (Score:2)
Have they investigated the giant casino in Manhattan?
Re: (Score:2)
You mean casinos, right? You have the NYSE HQ downtown, and the NASDAQ HQ in Times Square. There are probably other smaller exchanges that I'm not aware of, but it seems like a HUGE portion of NYC's economy was already based on economic speculation before Kalshi showed up.
New York Really is Going Full Authoritarian (Score:1)
These have already been proven to be federally regulated marketplaces because the house is not setting odds and you can exit your position at will. Not to mention you have to be of legal age to participate, meanwhile Pokemon packs have become a sensation where children record themselves gambling.
Re: (Score:2)
If you think prediction markets are legit, and not gambling, but Pokemon packs are gambling, then you've already lost the game, because you are a fucking retard.
Re: (Score:2)
You really think a market where you can perform an infinite amount of research before making a prediction is more gambling than buying a package that has a completely random chance of containing something of value??
Re: (Score:2)
> something of value
Value as defined by whom? The company making the cards/packs? The person opening the packs? The collective 3rd party market that has no affiliation with the company? Because they're all different.
You pay for a booster, you get what you paid for. Random cards. That's it. The cards themselves have NO intrinsic value. Value derived from a 3rd party market doesn't mean anything. If people are opening booster packs solely to try to find the ones that "sell" for the most money on a 3rd party market (which is also
Re: (Score:2)
There are plenty of places that list the value. The cards have a very specific value that you can sell at any time and yes most times they open the pack the immediate next thing they do is look up the value. Your argument is that nothing in the world has value which is absolutely rediculous.
Re: (Score:2)
> There are plenty of places that list the value.
Which is determined by a 3rd party market completely unrelated to both the company making the cards and the user opening the packs.
> The cards have a very specific value
They have a fluctuating value.
> yes most times they open the pack the immediate next thing they do is look up the value
The fucking stupid morons do this, yes.
> Your argument is that nothing in the world has value which is absolutely rediculous.
No, that isn't my argument. My argument is that the company making the cards monetarily values them all equally. For example, to Wizards of the Coast, an Alpha Black Lotus (sold for $3M) has the same value as a basic Swamp. And that value is basically just the cost to make the card (roughly 1-2 cents). The fact
So you want this (Score:1)
If you don't think you want this then you're incorrect. You do not want this level of gambling going on in society legally.
I'm guessing most of the people who click on this thread already aren't fans of legalized internet gambling but I know there are some right wingers out here that will back anything the president is backing and the president's son is knee deep in all of these gambling companies so the president is backing it.
So put aside that for a moment. Let's talk about what widespread gamblin
Re: (Score:2)
I always thought the problem with gambling wasn't necessarily that poor people waste their money on it (though some percentage certainly do), but that rich people waste their money on it. Rather than investing in things that generate genuine economic activity, you end up with wealthy people just playing a game of financial chicken against each other.
Revealing agendas. (Score:1)
> Kalshi is running an illegal operation and harming New Yorkers in the process...the lawsuit claims that Kalshi accepts wagers as a gambling business in disregard for the state's constitution and laws by not being registered with the New York State Gaming Commission. Governor Kathy Hochul..
..is pissed she ain't getting her cut. Plain and simple. This isn't about harming New Yorkers. This is about greasing palms.
That lying cunt is worried about gambling harm about as much as Las Vegas is. And she needs to be called out for it.
Re: (Score:2)
> ..is pissed she ain't getting her cut. Plain and simple. This isn't about harming New Yorkers. This is about greasing palms.
> That lying cunt is worried about gambling harm about as much as Las Vegas is. And she needs to be called out for it.
Is there something wrong with greasing palms or wanting a cut? Asking for a friend.
Re: (Score:2)
If you're a north American ... yes. If you are Asian, African or Mediterranean ... no.
Watch out Pokemon players (Score:2)
Letitia is coming for you, next!
Would this inefficient workaround be legal? (Score:1)
Set up two companies in a state or country where there are no legal issues. One says "invest in us, if [event] happens by [date], we will pay off more than you invest because company #2 will turn all their assets over to us" and the other says "invest in us, if [event] does not happen by [date], we will pay off more than you invest because company #1 will turn all of their assets over to us." Set up both companies to liquidate and return assets to stakeholders on [date].
Then list the companies on an excha
Re: (Score:2)
The whole idea is stupid.
Re: (Score:2)
No concrete product ... that's why it's pure gambling not investment.
Re: (Score:2)
Ha! I already bought all of that back in 1999 because Rush Limbaugh told me to.
Ignoring Laws is Ignoring Democracy (Score:1)
Given any law, there is always going to be a group of people who don't like it. However, if we let those in power, like huge rapidly growing corporations, or federal politicians, ignore laws _they_ don't like, we are losing democracy. Democracy means the laws get changed by legislators voted into office, if they are changed any other way, it is we, the people, who are losing power over our states. Clearly gambling is regulated by democratically enacted laws. Those laws absolutely should take full force on a
Re: Do they have any business presence in NY? (Score:1)
Does a internet gambling site need to have a presence in New York? I'm guessing you're talking about like an actual building with an address.