April

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Prediction-market exchange Kalshi has permanently banned former US Rep. George Santos from accessing the platform after its Compliance Department found “reasonable cause to believe” that he engaged in insider trading and market manipulation.The lifetime ban, effective August 28, 2026, is the first permanent penalty of its kind imposed by Kalshi on a user.<h2 id="penalty-and-lifetime-ban">Penalty and Lifetime Ban</h2>According to the official compliance document, Santos <a href="https://kalshi-public-docs.s3.amazonaws.com/regulatory/notices/KDA-2026-0006%20Santos%20Notice%20of%20Disciplinary%20Action.docx.pdf" rel="noopener noreferrer nofollow">traded</a> in markets linked to whether he would attend the State of the Union address on February 24, despite being prohibited from trading in those markets because he was capable of influencing the outcome of the underlying event. Kalshi said Santos placed a series of large trades between February 2 and February 25 in contracts whose results depended on his own attendance.The platform said Santos materially benefited from the activity and earned $17,839.57 from the targeted markets. Alongside the permanent suspension of direct and indirect access to the exchange, the Compliance Department has also imposed a $71,356 penalty.In response to the development, Santos <a href="https://x.com/Georgesantos/status/2094433522870063497" rel="noopener noreferrer nofollow">took</a> to X to attack Kalshi and accused the latter of violating its own notices and deadlines. He said that the August 7 notice allegedly gave his side 30 days before the latest action, as he questioned why the exchange had announced “frivolous nonsense” before that period was over.<blockquote>“Leaking and attention seeking seem to be the M/O of this organization. Pathetic!”</blockquote>The action comes after a settlement Santos reached last month with the Commodity Futures Trading Commission, which has said it has jurisdiction over prediction markets. He agreed to pay $35,000 under the settlement but did not admit or deny the agency’s findings. His counsel, Joseph W. Murray, said Santos cooperated with the CFTC.The former congressman was expelled from the House of Representatives in 2023 after facing federal charges. In April 2025, he was sentenced to more than seven years in prison after pleading guilty to wire fraud and identity theft. In October of that year, Trump announced that he had commuted the sentence, and Santos was released after serving less than three months.Kalshi had previously <a href="https://cryptopotato.com/kalshi-cracks-down-on-political-insider-trading-bans-three-us-candidates/" rel="noopener noreferrer nofollow">suspended</a> three US political candidates after finding they bet on election outcomes they were directly involved in, while calling the activity “political insider trading.”<h2 id="more-heat-on-prediction-markets">More Heat on Prediction Markets</h2>Prediction-market platforms face growing scrutiny from regulators and lawmakers. Last month, Baltimore officials <a href="https://cryptopotato.com/its-not-just-baltimore-kalshi-and-polymarket-face-more-legal-trouble/" rel="noopener noreferrer nofollow">sued</a> Kalshi and Polymarket, alleging that their sports prediction contracts amount to unlicensed sports betting and can mislead consumers about their legal and regulatory status.Meanwhile, Kalshi is also fighting a lawsuit from New York Attorney General Letitia James. The exchange has separately faced a lawsuit from FlightAware over flight-related markets, although that case was withdrawn shortly after being filed.The post <a href="https://cryptopotato.com/former-us-rep-george-santos-banned-from-kalshi-for-life-after-betting-on-himself/" rel="noopener noreferrer nofollow">Former US Rep. George Santos Banned From Kalshi for Life After Betting on Himself</a> appeared first on <a href="https://cryptopotato.com/" rel="noopener noreferrer nofollow">CryptoPotato</a>.

Former US Rep. George Santos Banned From Kalshi for Life After Betting on Himself

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