Santos Reported to DOJ for Suspicious Prediction Market Bets on Trump Speech

Federal authorities are examining suspicious financial activity involving former Congressman George Santos after a leading prediction market platform reported him to the Department of Justice. According to a source familiar with the matter, Kalshi made the referral after detecting trades by Santos that appeared to contradict his own public statements regarding attendance at former President Donald Trump's State of the Union address on February 24. The case centers on a sequence of events beginning in the weeks leading up to the high-profile speech. Santos, who was expelled from the House and later granted clemency by Trump following a fraud conviction, had repeatedly announced his intention to attend the event. However, Kalshi's internal monitoring identified that bets were placed against his attendance—a move that allegedly coincided with his declarations. On the eve of the address, the platform's market rated the probability of Santos appearing at nearly 75%. Minutes after the speech began, Santos posted on social media that he had been delayed at an airport, triggering immediate accusations of market manipulation from users online. In addition to the Justice Department, Kalshi notified the Commodity Futures Trading Commission (CFTC), the federal agency overseeing derivative markets. Both the DOJ and CFTC declined to comment on ongoing investigations. When reached for comment by CBS News, Santos called the allegations "news to me and my legal team." In a separate interview with NPR, he declined to confirm or deny having a Kalshi account, stating only, "I'm not saying yes, I'm not saying no." He later addressed the controversy on his podcast, remarking, "I guess people lost money. Some people made unexpected money. That's to show you how fragile these markets are." This incident amplifies growing regulatory and legislative concerns surrounding prediction markets like Kalshi and its rival Polymarket. As these platforms expand, lawmakers are pushing for stricter safeguards against insider trading. The Senate recently approved a bipartisan resolution barring its own members from using such markets. The scrutiny follows other cases, including the April indictment of a soldier accused of using classified information to win over $400,000 on Polymarket. Kalshi and Polymarket have stated they proactively report suspicious activity to regulators, underscoring an industry effort to police itself amid increasing federal oversight.