Key takeaways:
- Kalshi issued its first lifetime ban against George Santos and fined him $71,356 over bets tied to his own State of the Union attendance.
- The CFTC said Santos’ public posts moved contract prices in his favor, allowing him to make more than $17,500; Kalshi put his profit at $17,839.57.
- Santos agreed in July to pay $35,000 to settle the CFTC probe, while his attorney said the settlement was not an admission of wrongdoing.
Prediction market platform Kalshi has permanently banned former U.S. Rep. George Santos after finding that he bet against his own public statements about attending President Donald Trump’s State of the Union address, the company’s first lifetime ban of a user.
Kalshi also fined Santos $71,356, several times the $17,839.57 the company said he made from the wagers. The company said its compliance department found that Santos made public statements “with the intent to manipulate the price of the Yes or No contracts that he intended to purchase.”
“Ultimately, these statements did in fact manipulate the price of said contracts,” Kalshi said.
A Kalshi spokesperson told CBS News that Santos was banned because of “his lack of cooperation” with the company’s compliance department, which established “reasonable cause” to believe he had engaged in insider trading over his attendance at the address. The company barred him from “direct or indirect access” to its platform.
Santos responded Monday on X by mocking the decision. “Hey @Kalshi thanks for the lifetime ban from your gambling platform,” he wrote. “Let’s see how much longer you guys are around for.”
An attorney for Santos did not immediately respond to NBC News’ request for comment.
The ban follows a federal Commodity Futures Trading Commission investigation into Santos’ trades on Kalshi. In July, Santos agreed to pay $35,000 to settle the probe, and the CFTC imposed a three-year trading ban on him, CBS News reported. His attorney, Joseph Murray, said at the time that Santos settled to “put this matter behind” him and did not admit wrongdoing.
“He chose a prompt, practical resolution, rather than protracted, costly litigation, and that choice should not be mistaken for admission of any wrongdoing, because it is not one,” Murray said in a statement Santos shared on X.
The CFTC alleged that between Feb. 12 and Feb. 25, Santos traded on a contract titled “Who will attend the State of the Union?” and on whether he would attend the event. Because Santos could influence the outcome, he was prohibited from placing bets tied to his own attendance, according to a notice posted on Kalshi’s website.
Santos had posted on X in February that he planned to attend Trump’s speech. “I’m gonna be in the gallery,” he said in a video. He did not attend.
“After these posts, the SOTU contract prices moved in a direction favorable to Santos’ positions which allowed him to make over $17,500,” the CFTC said in July, according to CBS News.
Santos later addressed the episode on his podcast in March. “I guess people lost money,” he said. “Some people made unexpected money. That’s to show you how fragile these markets are.”
Santos, a former Republican congressman from New York, was expelled from Congress in 2023 while under federal investigation for fraud. He had previously been revealed to have fabricated large parts of his background during his congressional campaign. In 2024, he pleaded guilty to federal charges including wire fraud, identity theft and money laundering. He was sentenced to seven years in prison and ordered to pay nearly $374,000 in restitution and more than $200,000 in forfeiture.
Trump commuted Santos’ sentence after he had been incarcerated for three months. The president said Santos had been “horribly mistreated” and wrote on Truth Social, “Good luck George, have a great life!” CBS News reported that Santos served 84 days before being ordered released.
Kalshi also issued three other enforcement actions Monday against people running for public office who bet on their own candidacy, CBS News reported.
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