Federal Regulators Probe George Santos Over Suspected Prediction-Market Insider Trading
CBS News reported Tuesday that prediction marketplace Kalshi has referred former congressman George Santos to federal prosecutors over trades it flagged as suspicious ahead of President Trump’s State of the Union address in February.
Bet Against His Own Appearance
Santos had publicly and repeatedly said he planned to attend Trump’s February 24 address to Congress. On the eve of the speech, Kalshi’s market placed his attendance odds near 75%. Then, minutes after the address began, Santos posted on social media claiming he had been stranded at the airport and never made it inside.
The suspicious trades were placed in a contract directly tied to whether Santos would attend the event. Kalshi flagged the activity and formally referred the matter to the Department of Justice, according to a source who spoke to the Associated Press on condition of anonymity.
Regulators Now Involved
Beyond the DOJ referral, Kalshi also notified the Commodity Futures Trading Commission, which has publicly committed to pursuing insider trading cases on prediction platforms. Neither the DOJ nor the CFTC immediately responded to press inquiries. Santos told CBS News the allegations were “news to me and my legal team.” He separately told NPR he was unaware of any investigation and declined to confirm whether he even holds a Kalshi account.
Background on Santos and Prediction Markets
Santos won a New York congressional seat in 2022 after fabricating large parts of his professional biography. He later pleaded guilty to fraud and identity theft charges and was sentenced to seven years in federal prison. He served just 84 days before Trump granted him clemency in late 2024. The pardon came roughly four months before the State of the Union trade in question.
Prediction markets have faced growing regulatory attention as their popularity has surged. In April, a U.S. soldier was charged with using classified information to profit more than $400,000 on Polymarket by correctly predicting the timing of Venezuelan President Nicolas Maduro’s capture. That same month, the Senate passed a bipartisan resolution barring its own members from trading on prediction platforms.
What Santos Said Publicly
Speaking on his podcast in March, Santos addressed the wave of social media accusations that followed his airport story. He acknowledged that some traders lost money while others profited unexpectedly. He framed the episode as evidence of how volatile these markets can be, stopping well short of any denial of involvement.
The CFTC probe adds another legal complication for a figure already navigating the aftermath of a federal fraud conviction.
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