Calci’s legal woes pile up, as Arizona files first-ever criminal charges over ‘illegal gambling business’

Arizona Attorney General Chris Mayes has filed criminal charges against prediction market platform Calci for allegedly operating an illegal gambling business in the state without a license and betting on the election.

The 20-count complaint, which was filed in Maricopa County Circuit Court on Tuesday, accuses the company of engaging in unlicensed gambling activities, alleging that the site “accepted bets from Arizona residents on a wide range of events,” including state elections, a practice that is illegal in Arizona. The complaint charges Calci with four counts of election wagering for accepting bets from Arizona residents in the 2028 presidential race, the 2026 Arizona governor’s race, the 2026 Arizona Republican gubernatorial primary, and the 2026 Arizona state secretary of state race.

This is the first time a country has pursued such charges against the company, according to the AZ Mirror, and represents a major escalation in the battle between countries and the prediction market industry.

“Calci may brand itself as a ‘predictive market,’ but what it is actually doing is running an illegal gambling operation and betting on the Arizona election, both of which violate Arizona law,” Attorney General Mayes said in a statement. “No company has the right to decide for itself what laws it must follow.”

It is worth noting that the charges are technically misdemeanors. It follows a small wave of cease-and-desist letters, lawsuits, and other official actions from states over Calci’s activities, in which several officials have complained that the company is circumventing state gambling laws.

Conversely, prediction sites like Calci have argued that they do not violate state law because they are federally regulated through the Commodity Futures Trading Commission.

Kalshi may be under attack left, right and center, but the company has also taken its own legal action, which is often proactive.

Calci filed a lawsuit against the Arizona Game Department in federal court on March 12. The company’s lawsuit alleged that Arizona’s regulatory attempts were interfering “with the federal government’s exclusive authority to regulate derivatives trading on exchanges.” Calci also recently filed a lawsuit against the states of Iowa and Utah on similar grounds.

Mayes’ office says the company is just trying to avoid accountability.

“Calci has made a habit of suing states instead of following their laws,” Mayes said in a statement. “In the past three weeks alone, the company has filed lawsuits against the states of Iowa, Utah, and now Arizona.” “Instead of working within the legal frameworks created by states like Arizona, Calci is turning to federal court to try to avoid accountability.”

Elizabeth Diana, Calci’s chief communications officer, called the criminal charges in Arizona “dangerously flawed” and a matter of “fraud” related to the company’s lawsuits against the state.

“Four days after Kalci filed a lawsuit in federal court, these charges were filed to circumvent the federal court and obstruct the normal judicial process,” Diana said. “They are trying to prevent federal courts from evaluating the case on the merits — whether Calci is subject to exclusive federal jurisdiction. These charges are baseless, and we look forward to fighting them in court.”

Federal officials have indicated they side with the forecasting industry, leading to a potential regulatory showdown between states and the federal bureaucracy. Recently, Michael Selig, Chairman of the Commodity Futures Trading Commission, published an op-ed in the Wall Street Journal in which he accused state governments of “launching legal attacks on the CFTC’s authority to regulate” such sites. Selig also claimed that his agency would not “sit idly by while overzealous state governments” undermine the agency’s “exclusive jurisdiction” over the industry.