New Jersey adds responsible-gaming rules for online operators as AG targets Kalshi

New Jersey Attorney General Jennifer Davenport, working with state gaming regulators, has added data-driven responsible-gaming requirements to the regulations for online operators. Davenport announced the changes at a news conference on Tuesday. The requirements apply only to online operators at present.

The rules oblige operators to watch customers for particular criteria that point to problematic gaming. For harder cases, players must be given resources such as a live call or chat, and operators may have to act to halt their gambling. Every operator is required to name a responsible-gaming lead to run these efforts. To spot patrons who may need help, operators must apply mandatory patron play thresholds and behavioural triggers, and a due-diligence review follows when a patron meets those criteria.

Should that review reveal signs of potential problem gaming, the operator places the person on its at-risk patrons list and applies three phases of interventions shaped by its assessment. Jamie McKelvey, responsible-gaming coordinator with the Division of Gaming Enforcement (DGE), explained that a trigger alone does not prove a gambling problem; rather, it obliges the operator to carry out the review. At phase three, the highest level, the responsible-gaming lead and the patron must communicate live, and if the operator still considers the patron at risk after that, McKelvey said, the account is shut.

Davenport said the protections were needed because of growth in retail and online casino games and sports betting. She said the criteria give every operator the same rules so that problem behaviour can be flagged wherever someone plays.

Davenport also took aim at prediction markets, saying Kalshi's claim to offer legal sports betting nationwide while declining to obey state gaming laws is a serious problem. According to her, New Jersey wants the US Supreme Court to rule that prediction markets fall under state gaming laws. The state filed last month for review of an appellate decision holding that the Commodity Exchange Act prevents states from regulating sports event contracts on prediction markets, and it argues the justices must intervene because lower courts disagree.

The state's filing contended that a 2-1 ruling from the US Third Circuit Court of Appeals would destroy state oversight of sports betting and leave operators open to federal Wire Act violations. That court held that only the Commodity Futures Trading Commission may regulate sports event contracts from Kalshi, Polymarket and similar prediction market platforms. Its conclusion clashes with a ruling from the US Circuit Court of Appeals for the Ninth District, which let Nevada ban sports event contracts and expressed doubt that Congress meant to override state gaming regulations through the Dodd-Frank Act of 2010.

Davenport told reporters that 39 states, the District of Columbia, 146 tribal nations and tribal organizations, and the NFL backed New Jersey's request for Supreme Court review. Because of the Third Circuit's ruling, Kalshi and other platforms keep offering sports event contracts in the state. She described their product as one that cannot be distinguished from what the state regards as sports wagering, and said the case is meant to guarantee that sports wagering in New Jersey comes only from operators holding state licences and complying with its regulatory requirements.

Mary Jo Flaherty, interim director of the DGE, expressed hope that the Supreme Court would accept the case and “that we will have a favorable ruling on the merits.” Asked whether the DGE ought to sanction DraftKings and FanDuel, both of which hold New Jersey licences, for offering prediction markets, Flaherty stressed that at present neither is offering prediction markets inside the state.

Davenport and the DGE used Tuesday to unveil RecoverMe, a free cognitive-behavioral therapy app for people with gambling problems. It helps users assess their gambling behaviour through validated assessment tools, lets them take part flexibly in sessions grounded in evidence-based therapy, and tracks their gambling habits. The app additionally carries services specific to New Jersey for people facing a crisis who require emergency support.