New York defies Trump admin, asks court to shut down Polymarket gambling

# New York defies Trump admin, asks court to shut down Polymarket gambling Source: [https://arstechnica.com/tech-policy/2026/09/new-york-asks-court-to-shut-down-polymarkets-illegal-gambling-operation/](https://arstechnica.com/tech-policy/2026/09/new-york-asks-court-to-shut-down-polymarkets-illegal-gambling-operation/) New York sued Polymarket today, alleging that it runs an “illegal gambling operation” through its prediction market\. “By running an unlicensed gambling operation, Polymarket has done more than just knowingly violate state law, they have put New Yorkers at risk, especially those underage who are most vulnerable to problem gaming,” Governor Kathy Hochul said in a[press release](https://www.governor.ny.gov/news/governor-hochul-and-attorney-general-james-announce-lawsuit-against-polymarket-running-illegal)announcing the lawsuit\. Polymarket is “sidestepping its obligation to pay taxes like licensed casinos and mobile sports gambling platforms do,” New York said\. “This tax revenue from gambling regulation funds public schools, sports programs for underserved youth, and problem gambling education and treatment\.” Polymarket is “available to users between the ages of 18–20, even though New York law requires a person to be at least 21 years old to participate in mobile sports betting,” exposing young people to gambling’s “damaging effects on their mental and financial well\-being,” New York said\. New York previously sued Kalshi, Polymarket’s chief rival\. The Trump administration is on the side of the prediction markets, with the Commodity Futures Trading Commission \(CFTC\) asserting exclusive jurisdiction over the platforms\. In August, the CFTC[declared](https://arstechnica.com/tech-policy/2026/08/us-tries-to-override-new-york-gambling-laws-orders-kalshi-to-keep-operating/)a “market emergency” in New York in an attempt to stop the state from applying its gambling laws to Kalshi\. ## Gambling with a different name Polymarket and its rival Kalshi offer sports bets in the form of “event contracts” or “swaps,” which state governments and some courts say are just gambling with a different name\. “Our gambling laws exist to protect New Yorkers, prevent the potential harms of problem gambling, and ensure funding for educational and public benefit programs,” New York Attorney General Letitia James said\. “By skirting New York’s laws, Polymarket is targeting the most vulnerable and depriving New York families of critical services and support\.” The New York press release said the state government is “seeking a court order stopping Polymarket from operating as an unlicensed gambling business and requiring the company to pay fines, forfeit all illegal gains and pay restitution to users\.” The[lawsuit](https://ag.ny.gov/sites/default/files/court-filings/new-york-v-polymarket-us-petition-2026.pdf)was filed today in a New York County court\.