According to documents obtained through a public records request, the American Gaming Association (AGA), which represents commercial casinos, supplied Maryland officials with an interesting template letter regarding the CFTC and prediction markets in April of last year. Apparently, it urged the Commodity Futures Trading Commission (CFTC) to ban sports-related event contracts offered by companies such as Kalshi and Polymarket.
Some Question the Independence of the Maryland Gaming Regulator
It also appears that Maryland used the letter, as just a few days later, the Maryland Lottery and Gaming Control Agency (MLGCA) sent a cease-and-desist letter to Kalshi, ordering it to cease operations in the state. This letter used a lot of the wording from the original AGA document.
With this being the case, some have called into question the independence of the MLGCA. A chief voice among these is that of Sean Patrick Maloney, president and CEO of the Coalition for Prediction Markets, which lobbies on behalf of prediction markets companies. He described the letter as a “smoking gun” and claimed the Agency isn’t independent, as it has casino lobbyists in the face of AGA that are pushing it to interfere with the work prediction markets.
“They (the MLGCA) are clearly taking their marching orders from the casino lobbyists,” Maloney said. “That’s not what the citizens of Maryland deserve. They deserve people doing the public’s work, not running errands for casino lobbyists.”
Additional documents reviewed by Spotlight on Maryland highlighted an interesting email by John Martin, director of the Maryland Lottery and Gaming Control Agency, from April 22, 2025. In it, he allegedly wrote regarding a “possible action” involving a letter to be emailed to the CFTC commissioners, noting that the letter had been “provided by the American Gaming Association (AGA).”
It isn’t like Maryland doesn’t have anything to lose if companies like Kalshi and Polymarket take away casino goers. The state’s casino industry is solid and provides much tax income. This year, Maryland’s casinos generated more revenue compared to 2025, and high revenue means larger taxes. However, the potential competition from prediction market platforms could also mean fewer casino patrons, ultimately resulting in less taxes for the state.
MLGCA Defends Its Stance
When asked about the letter, a spokesperson for the MLGCA said the agency had acted independently in reaching its position. They explained that the Agency evaluated this issue and determined its stance based on what is in the state’s best interests.
John Holden, a professor of business law at Indiana University who specializes in sports betting regulation, said it is common for trade associations such as the AGA to prepare template letters and talking points for government officials. He explained that the rapid expansion of legal sports betting in the US has led to a regulatory system in which state regulators, such as the MLGCA, work closely with the casino industry they are responsible for overseeing.
Meanwhile, an AGA spokesperson defended the policy position outlined in the letter. In addition, they did not dispute that the organization had provided the draft to Maryland officials before the agency submitted it to the CFTC. The spokesperson also said that Congress intended for sports betting to be regulated by states and tribal governments. The letter reflects an effort to uphold Maryland’s gambling laws for the benefit of its residents, the spokesperson said.
In other news regarding the state, one player recently won $1 million from the Maryland Lottery.