New Mexico Attorney General Raúl Torrez filed a lawsuit accusing Kalshi, a U.S.-based prediction market platform, of circumventing state gambling laws by offering unregulated sports betting disguised as financial trading, Source NM reports. The lawsuit, filed in New Mexico’s First Judicial District Court, argues that Kalshi’s activities are a "public nuisance" driving compulsive gambling in a state where the rate of gambling problems is nearly four times the national average.
The state alleges that Kalshi’s event contracts, which let users wager on outcomes such as sports results, are illegal gambling under a 1953 state law that prohibits most wagering not explicitly authorized under the Gaming Control Act. The suit also claims the platform offers bets tied to real-time sports events, including NBA games, which prosecutors say work the same as traditional sports betting.
Torrez said in a statement announcing the lawsuit that Kalshi ignored the state’s framework of negotiated terms and licensing rules for gambling. "We are filing this lawsuit to protect the integrity of our laws, our regulatory system, and most importantly, consumers," he said, Source NM reported.
The lawsuit adds to the pressure on the company. Three New Mexico pueblos and one tribe filed a separate federal lawsuit in May arguing that Kalshi allows sports gambling on tribal land, undermining the tribal governments’ rights to raise revenue for schools and other institutions. Lauren Rodriguez, chief of staff at the New Mexico Department of Justice, told Source NM the state and tribal cases are separate but complementary.
About This Story
Daily Reports is Brant.One’s news roundup. Each day we gather the New Mexico stories worth knowing from newsrooms across the state, sum them up and point you to the source. This one comes from Source NM’s reporting, and their original story has the interviews and full details.
Editor’s note: Updated Oct. 31, 2026. This story is now part of Daily Reports, our New Mexico news roundup, and was revised to credit Source NM’s original reporting. Learn how Daily Reports works in our editorial standards.
