New Jersey Attorney General Jennifer Davenport in partnership with state gaming regulators have implemented data-driven responsible-gaming requirements for online operators, which have been added to their regulations.
“We’re making the consumer safety net even stronger,” Davenport announced Tuesday in a news conference. “These regulations require that operators monitor their customers for specific criteria, indicating problematic gaming.”
The regulations, which apply only to the online operators now, also require them to provide players with resources, including a live call or chat for more problematic cases, and if need be take action to stop them from gambling.
“Creating clear consistent criteria for identifying problem gambling means every operator follows the same rules,” Davenport said. “So problem behaviors can be flagged, no matter where someone plays.”
Davenport said they’re making it mandatory for operators to track their players and to intervene when appropriate and necessary. She said these protections were needed because of an explosion in retail and online casino games, as well as sports betting.
“Ads are everywhere. You can gamble anywhere,” the attorney general told reporters. “But when you wager in New Jersey, you should be protected by our strict gaming laws.”
Davenport targeted prediction markets for the way they operate outside of state gaming laws and consumer protections.
“That’s why it’s so problematic that Kalshi claims to offer legal sports betting in all 50 states, but refuses to follow state gaming laws,” Davenport said. “That’s why we’re asking the U.S. Supreme Court to look at this question and hold that prediction markets are subject to state gaming laws.”
Last month, New Jersey asked the Supreme Court to review an appellate ruling that found the Commodity Exchange Act bars states from regulating sports event contracts offered on prediction markets, arguing the high court needs to step in, because lower courts have split on the issue.
In its filing, the state argued a recent 2-1 decision from the U.S. Third Circuit Court of Appeals would kill state regulation of sports betting and expose operators to violations of the federal Wire Act.
The court found sports event contracts offered by Kalshi, Polymarket, and other prediction market platforms can be regulated only by the Commodity Futures Trading Commission.
The decision conflicts with a ruling by the U.S. Circuit Court of Appeals for the Ninth District that granted Nevada the ability to prohibit sports event contracts, saying they were dubious that Congress had intended to overrule state gaming regulations when they passed the Dodd-Frank Act in 2010.
Davenport reminded reporters that New Jersey was joined by 39 states and the District of Columbia, along with 146 tribal nations and tribal organizations, and the NFL in seeking to have the Supreme Court take up the case.
The Third Circuit’s decision means Kalshi and other platforms continue to offer sports event contracts in New Jersey. Davenport said when that prediction markets are “offering a product that is indistinguishable from what we maintain is sports wagering.”
“Our litigation is to ensure that only operators licensed by the state of New Jersey, and meeting our regulatory requirements offer sports wagering in our state,” Davenport said.
Mary Jo Flaherty, interim director of the state’s Division of Gaming Enforcement (DGE), said she was hopeful that the Supreme Court would take the case and “that we will have a favorable ruling on the merits.”
When asked if the DGE should punish DraftKings and FanDuel, both licensed in New Jersey, for offering prediction markets, Flaherty made it clear that at this point, they’re not offering prediction markets within the state.
Responsible-gaming regulations
The new responsible-gaming regulations require every operator to appoint a responsible-gaming lead who oversees those efforts. Operators must employ a set of mandatory patron play thresholds and behavioral triggers to help identify patrons who may need support.
Where patrons meet those criteria, operators must engage in a due-diligence review to determine whether the patron is exhibiting signs of potential problem gaming. If so, the operator must add the person to its list of at-risk patrons and apply three phases of interventions based on the operator’s assessment.
“These criteria identify patterns of behavior that may indicate gambling-related harm,” said Jamie McKelvey, responsible-gaming coordinator with the DGE. “A trigger doesn’t automatically mean that someone has a gambling problem. Instead, it requires the operator to conduct a due-diligence review.”
During that review, McKelvey said, the operator evaluates the patron’s overall gaming activity and relevant behavioral indicators to determine whether he or she should be designated as at risk.
“The goal is to identify concerning behavior and assess the individual circumstances before determining what intervention, if any, is appropriate,” she said.
When an operator determines that a patron is at risk, the regulations require a phased intervention process with each of the three phases designed to provide information, encourage engagement, and connect patrons with appropriate support.
“At the highest level, phase three, interventions require live communication between the responsible-gaming lead and the patron,” McKelvey said. “These communications are intended to ensure meaningful individualized communication with patrons exhibiting strong indicators of problematic play.”
If after that intervention, McKelvey said, an operator believes the patron is at risk, “the account will be closed.”
On Tuesday, Davenport and the DGE also announced the release of RecoverMe, a cognitive-behavioral therapy app to assist those with gambling problems free of charge.
The RecoverMe app, which aids individuals in gauging their gambling behavior, uses validated assessment tools, provides flexible engagement in sessions based on evidence-based therapy, and offers tracking systems for their gambling habits.
RecoverMe also contains additional New Jersey-specific services for individuals who are in crisis and need emergency support.
