Ex-congressman George Santos banned from betting platform for life
The prediction market operator Kalshi says Santos made barred trades and misleading comments that influenced prices.
Prediction-market operator Kalshi has permanently banned former US Representative George Santos from its platform, citing insider dealing related to bets he placed on his own attendance at former President Donald Trump's State of the Union address in February.
According to a disciplinary notice, Kalshi's compliance team concluded that Santos's activity showed signs of insider trading, leading to the lifetime ban. The company stated it acted independently, without waiting for external enforcement action.
Santos responded to the ban on X, thanking Kalshi and adding, "Let's see how much longer you guys are around for." The BBC has reached out to Santos for comment.
In 2025, Trump ordered the release of Santos, who had served three months of a seven-year prison sentence for wire fraud and identity theft.
Last July, Santos agreed to a $35,000 settlement with the Commodity Futures Trading Commission (CFTC) regarding a federal investigation into his State of the Union trades. Kalshi, alleging Santos used non-public information for his bets, issued its own penalty of $71,356 (£38,000).
These disciplinary actions come as prediction markets, which allow users to wager on outcomes from elections to economic indicators, face increased scrutiny. Both Kalshi and competitor Polymarket have reported a rise in unusual trading patterns, prompting platforms to enhance monitoring and respond more aggressively to potential misconduct.
Kalshi confirmed that Santos's case was referred to federal authorities earlier this summer after internal systems flagged suspicious activity linked to his account. The company explained that the case centered on trades in a market tied to his attendance at Trump's address, an event he could directly influence.
Its compliance team found that Santos placed a series of substantial bets between February 2 and 25. Some of these bets, according to the company, were based on false or misleading public statements he made about his plans, which influenced contract prices. Ultimately, he earned $17,839.57 from these trades.
Santos has denied wrongdoing in various matters but has admitted to stealing the identities of nearly a dozen individuals, including next of kin. He pleaded guilty to wire fraud and aggravated identity theft, serving three months in prison before Trump commuted his sentence last year.
He significantly embellished his biography leading up to his 2022 election to Congress. The former lawmaker was only the sixth in US history to be expelled from Congress.
The Kalshi incident highlights the growing compliance challenges for prediction markets as they attract more users and become more mainstream. Regulators have indicated that platforms will be expected to meet higher standards as the industry matures, particularly concerning political or economic events.
Santos, who was expelled from Congress following a series of fraud and identity-theft charges, remains a polarizing figure in US politics. His criminal conviction led to a prison sentence of over seven years, which Trump later commuted. Santos has denied wrongdoing in various matters but has admitted to stealing the identities of nearly a dozen people, including next of kin.