Former Congressman George Santos Banned From Kalshi for Insider Trading

George Santos, a former Republican congressman, has been banned for life from prediction market site Kalshi. The site uncovered that Santos misled the public about attending President Trump’s State of the Union address to profit from bets.

Kalshi fined Santos $71,356 for the offense. Santos reacted on X, expressing disregard for the platform’s actions.

Federal authorities were alerted to Santos’ trades by NPR, prompting a federal investigation. Santos falsely claimed he would attend the event, then revealed he watched it from an airport, concealing his wagers on not attending.

Santos made over $17,000 from these bets. The Commodity Futures Trading Commission ordered him to repay the profits and fined him $17,500.

Santos, 38, has a history of deception. He was expelled from Congress in 2023, pleaded guilty to wire fraud and identity theft, and was released from prison after a presidential commutation.

Kalshi also penalized other candidates for betting on their campaigns. This includes Laurie Buckhout, Stephen Cloobeck, and Ben Midgley, who faced suspensions and fines for such actions.

Regulator actions extended beyond candidates. Gabriel Perez, a former teleprompter operator, profited from advance knowledge of Trump’s speeches. He faced financial penalties and reimbursement demands.

The prediction market industry is debated for possible regulation as gambling or financial products. Legal challenges are ongoing, with the Supreme Court expected to decide on the matter.

Recently, 44 states opposed prediction markets, citing potential for young people and gambling addicts to fall prey to these platforms.