Kalshi bars former congressman George Santos for insider trading

Kalshi has permanently suspended former US congressman George Santos from accessing its prediction market platform after finding that he manipulated contracts tied to whether he would attend the State of the Union address.

The exchange said its compliance department had reasonable cause to believe Santos traded in markets where the outcome depended on his own attendance, despite Kalshi rules prohibiting members from trading on events they can influence.

Between Feb. 2 and Feb. 25, Santos placed a series of large trades in the market before making public statements about whether he planned to attend the event.

Kalshi said some of those statements were false or misleading and were made with the intent to influence the prices of Yes and No contracts that Santos intended to purchase. The exchange said the statements ultimately affected the prices of the contracts.

Santos earned $17,839.57 from the trading activity, according to the disciplinary notice. Kalshi said the conduct violated its rules against market manipulation, fraudulent schemes, and practices that operate as a fraud or deceit on other participants.

The exchange imposed a $71,356 penalty and permanently suspended Santos from directly or indirectly accessing Kalshi. The disciplinary action took effect on Aug. 28.

The notice also lists Kalshi rules prohibiting members from trading when they possess material nonpublic information or have influence over an underlying event. 

However, the specific findings in the notice center on Santos trading contracts tied to his own attendance and subsequently manipulating their prices through public statements.