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The Massachusetts Gaming Commission warned the National Council on Problem Gambling that it is “on notice” over its partnership with prediction market operator Kalshi.
The admonition from the MGC came during a mid-September meeting as commissioners discussed the NCPG and the states that have severed ties with the non-profit organization following its partnership with Kalshi.
Three NCPG exits so far
In May, the NCPG announced that Kalshi was providing $2 million for a health and safety initiative and that the organization was establishing a financial services and trading membership category. Since then, the Ohio Casino Control Commission, the Michigan Gaming Control Board, and Nevada‘s state problem gambling council have cut ties with NCPG. In addition, “other states have expressed concern” about the partnership, according to the MGC’s Director of Research and Responsible Gaming, Mark Vander Linden.
Ohio’s top regulator told NCPG that the partnership “seeks to legitimize an illegal sportsbook operating in Ohio.” Ohio fined Kalshi $5 million about a month before NCPG announced the deal. Michigan said that the NCPG “directly undermines state enforcement actions” by partnering with a company the state is litigating against.
MGC asked NCPG directly whether Kalshi deal is an endorsement
Before making a recommendation for Massachusetts to retain its NCPG membership, Vander Linden contacted the organization to seek more information about the Kalshi relationship. Among the questions he put to NCPG was one that goes directly to the concern raised by state regulators: “Does this mean NCPG is endorsing prediction markets or Kalshi?”
“NCPG remains neutral on the legality of gambling, wagering, and prediction markets,” the organization responded. “This initiative is not an endorsement of any product or platform.”
NCPG added that its role is to ensure “consumer protection, risk awareness, harm mitigation, and access to care evolve alongside” prediction markets as those markets develop.
Massachusetts regulators express deep skepticism
While Massachusetts commissioners accepted Vander Linden’s recommendation, that decision came with significant reservations from commissioners, particularly Nakisha Skinner and Eileen O’Brien, plus a warning from MGC chair Jordan Maynard that NCPG is now under heightened scrutiny.
Skinner raised the most extensive concerns among Massachusetts commissioners. Her concerns went beyond the NCPG accepting a $2 million contribution. She also focused on the creation of the financial services and trading category.
“I understand that NCPG remains neutral, but creating that subcategory, to me, it does legitimize companies like Kalshi,” Skinner said and connected that concern to the same responsible gaming principle cited by Michigan.
“The creation of that category runs counter to what I believe is one of the foundational principles of responsible gaming, which is that gaming is not profitable in that sense,” she said. “It’s not an investment. It’s not money. It is primarily for entertainment.”
However, Skinner said she accepted Vander Linden’s recommendation because she did not want the commission to take what she viewed as an inconsistent approach toward NCPG while licensed operators connected to Massachusetts also conduct prediction market business elsewhere.
O’Brien also agreed to remain in NCPG for the time being, but echoed Skinner’s concerns and also pointed to the uncertain regulatory status of prediction markets.
“This entity is in a gray area,” O’Brien said. “There’s overlap with what we regulate. There’s a lot of litigation around it.”
O’Brien said she was comfortable accepting Vander Linden’s recommendation “for now,” but warned that circumstances could change quickly.
“I think we need to keep an eye on this because it may be that there comes a time sooner rather than later where we have to sever ties,” she said.
“NCPG should be on notice,” Maynard said during the meeting. “Anything that we do and anything that we’re a part of, we’re going to stand for our values.”
Maynard supported remaining with NCPG but framed the decision as anything but permanent.
“We’re going to be who we are, and we’re not going to change just because somebody’s taking money from one of these prediction market companies,” Maynard said. “We’re going to hold their feet to the fire.” He added that when the MGC’s membership with NCPG comes up for renewal, “I bet we’re going to have another conversation.”
