Federal regulators are now investigating former House Representative George Santos over suspicious prediction market trading via Kalshi. According to the Justice Department, Santos allegedly trades illegally in a prediction contract that referenced his own appearance at this year’s State of the Union address.
In late February, prediction market Kalshi informed the Commodity Futures Trading Commission and Justice Department about suspected trading, people familiar with the referral said. George Santos was said to have placed a bet on a contract that asked whether he would appear at the president’s annual address to Congress that month at the Capitol, sources close to the investigation tell the Wall Street Journal. Santos didn’t attend the speech and allegedly placed a bet that he wouldn’t. The CFTC has since opened an investigation, and the Justice Department is also involved in the investigation, having received Kalshi’s referral.
George Santos was expelled from the House in 2023 and pleaded guilty to federal charges in 2024, with US President Donald Trump later commuting his sentence. In a statement via X on Wednesday, the former House Representative denied the accusations. “My legal team is in contact with the DOJ to see what is going on,” Santos wrote. “The accusation is preposterous, and I look forward to supplying any information asked of me to any agency that inquires.”
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The rise of prediction markets, which the CFTC regulates, has created a new temptation in Washington, where the Trump administration’s fast-moving agenda is giving those privy to government information a chance to cash in on the volatility. Regulators and prosecutors are playing catch-up to address a rash of suspicious betting that touches various corners of the federal bureaucracy. Several US states have already placed bans on trading in prediction markets. In April, authorities charged a U.S. Army special forces soldier with illegally betting on the ouster of Venezuelan strongman Nicolás Maduro. Gannon Ken Van Dyke has pleaded not guilty. Last month, prosecutors alleged that a Google employee, Michele Spagnuolo, traded on a Polymarket bet that allowed people to wager on who would be revealed as the most searched person of 2025.