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— Editor note: Kalshi is a proud sponsor of Real News No Bullshit and occasionally their data is referenced in articles we post on our Instagram. Kalshi has no influence over what we write.
Federal regulators are investigating former Representative George Santos for possible insider trading on the popular prediction market Kalshi.
Getting into it: First reported by NPR, the probe centers on a scheme tied to Trump’s February 24 State of the Union. Ahead of the speech, the ex-congressman publicly hyped that he’d be there (“I’m gonna be in the gallery,” he teased on X), helping drive his attendance odds on Kalshi to nearly 75%, where traders had wagered millions on who would show up alongside names like Barron Trump and hockey star Jack Hughes. Then Santos allegedly bet against his own attendance and never appeared, claiming minutes into the speech that he’d been stuck at the airport, a turn so on-brand that social media users immediately accused him of running a con.
Kalshi caught on to it pretty fast, and the platform ultimately determined the account being used was owned by Santos, froze it, and referred the matter to both the Justice Department and the Commodity Futures Trading Commission around the end of February. The CFTC, which regulates prediction markets, has confirmed it’s investigating, though it remains unclear whether the DOJ has opened its own probe.
Santos came out swinging against the reports, calling the accusations “preposterous” and saying he’d cooperate with any agency that inquired, while telling reporters not to bother him in the meantime. Asked directly whether he even had a Kalshi account, he dodged: “I’m not saying yes, I’m not saying no.” He’d already addressed the swirling complaints on his podcast back in March, shrugging that “some people lost money” and “some people made unexpected money,” adding, “That’s to show you how fragile these markets are.”
The investigation lands as prediction markets like Kalshi explode in popularity while regulators scramble to keep up. Santos’s is at least the third insider-trading case to surface in recent weeks, following charges against a Google employee accused of betting on internet search results and a US Special Forces soldier who allegedly leaned on classified intel to rake in over $400,000 betting on when Venezuelan leader Nicolás Maduro would be captured.
Lawmakers have responded by introducing bills to ban bets on military operations (amid concerns over suspiciously well-timed trades on the Iran war) and approving a Senate resolution barring members from using the platforms.
