Letitia James
New York State is suing Polymarket for running an illegal gambling operation in the state through its prediction market platform.
Polymarket launched in the United States in December 2025 as a service that allowed users to bet money on the outcome of sporting events, promising users “sports – followed by markets on everything.”
The lawsuit alleges that Polymarket’s prediction markets meet the legal definition of gambling because the outcomes of the events on which its users are betting are uncertain and outside the control of the bettor or hinge on a game of chance. State Attorney General Letitia James said that despite this, Polymarket has failed to obtain a license from the New York State Gaming Commission, sidestepping its obligation to pay taxes like licensed casinos and mobile sports gambling platforms do. Tax revenue from gambling regulation funds public schools, sports programs for underserved youth, and problem gambling education and treatment.
Polymarket’s prediction markets are also available to users between the ages of 18 to 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 online gambling can have damaging effects on their mental and financial well-being. A recent study by the National Institute of Health found that early exposure to gambling increases the likelihood of depression, anxiety, mood swings, and financial stress. Further, a study by the American Psychological Association found that 32 percent of those with a gambling disorder experience suicidal ideation.
In the lawsuit, Attorney General James is asking the court to order Polymarket to forfeit all illegal gains, distribute restitution to consumers who were harmed, and pay fines equal to three times the gains the company made through its illegal actions.
The Office of Attorney General (OAG) has been going after other platforms for illegal gambling. In July 2026, Attorney General James and Governor Kathy Hochul announced a lawsuit against Kalshi for running an illegal gambling platform. In April 2026, James sued Coinbase and Gemini for running illegal gambling platforms. In January 2026, James sued Valve, a video game developer, for illegally promoting gambling through video games popular with children and teenagers. In June 2025, James stopped 26 illegal online sweepstakes casinos that offered slots, table games, and sports betting using virtual coins that could be exchanged for cash and prizes.
Attorney General James and Governor Hochul urge New Yorkers to ensure gambling platforms are registered with the New York State Gaming Commission and report any misconduct or gaming fraud to OAG by filing a complaint online, which can be done anonymously, or calling 1-800-771-7755.
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