Kalshi, a prediction market platform, announced the lifetime ban and financial penalty against former Republican congressman George Santos following an investigation into his trading activity on the site. The company determined that Santos had publicly stated he would attend the State of the Union address while simultaneously placing wagers that he would not appear, ultimately profiting more than $17,000 from the bets.
Federal regulators had previously launched their own investigation into Santos’s trading activity. The Commodity Futures Trading Commission, which oversees prediction markets, reached a settlement with Santos last month requiring him to return his profits and pay an additional $17,500 in fines. Santos, who represented New York in Congress before his expulsion in 2023 and later had his prison sentence commuted by President Trump after pleading guilty to wire fraud and identity theft charges, responded to the ban with a post on social media.
Kalshi’s action against Santos was part of a broader series of enforcement measures announced against multiple individuals involved in prediction market trading. Republican congressional candidate Laurie Buckhout received a three-year suspension and fine for wagering on her own race, while billionaire Stephen Cloobeck was similarly sanctioned for betting on his gubernatorial campaign. Former Planet Fitness president Ben Midgley, who ran for Maine’s Republican gubernatorial nomination, also received a three-year suspension and penalty for placing bets on his own candidacy.
The crackdowns follow a separate case involving Gabriel Perez, a former teleprompter operator for President Trump, who was required to return over $100,000 in profits gained through betting on the president’s word choices during speeches. Regulators also imposed an additional $65,000 fine on Perez.
The enforcement actions highlight ongoing regulatory scrutiny of the prediction market industry, which operates with minimal federal oversight under the current administration. Multiple states have challenged the legal status of prediction markets, with courts currently split on whether these platforms should be classified as gambling operations or financial instruments. The Supreme Court is expected to ultimately determine the regulatory framework for the industry.
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