Kalshi bans George Santos for betting fraud on prediction platform.
The betting platform Kalshi has permanently banned former US congressman George Santos, the son of Brazilian immigrants, on suspicion of gambling fraud. This permanent ban is the first time the company has ever banned a user.
According to G1 Mundo, Santos had already been fined and temporarily banned from using the service following a regulatory investigation. The case gained notoriety because it involved a politician who pleaded guilty in a corruption case in the American justice system on August 19, 2024.
Betting before Trump's speech
Kalshi's investigation focused on transactions made by Santos before President Donald Trump's State of the Union address on Tuesday (February 24). The former congressman had repeatedly stated that he would be present at the event. The day before, the platform estimated the probability of his attendance at almost 75%.
A few minutes after the speech began, Santos posted on X that he had been detained at the airport and would not be attending the event. The post generated accusations on social media that he had bet against his own attendance to profit from the information.
Kalshi reported the transactions to the CFTC, the American regulatory body responsible for overseeing derivatives markets. The agency had been intensifying its scrutiny of potential cases of insider trading on this type of platform.
Negative and repercussions
Santos denied having knowledge of the investigation. In an interview with NPR, he refused to confirm or deny having an account at Kalshi. "I'm not saying yes, nor am I saying no," he stated.
In March, the former congressman addressed the episode on his podcast . He said that some people had lost money on the bets and that the case would show how "fragile" prediction markets can be.
The ban comes amid increasing regulatory pressure on platforms like Kalshi and Polymarket. US lawmakers have been demanding that the companies take measures against insider trading. Both platforms claim they report suspicious trades to the appropriate authorities.
