Former Rep. George Santos is under investigation by the Justice Department and the Commodity Futures Trading Commission over alleged insider trading on Kalshi, after unusual trades tied to his expected appearance at the State of the Union drew the platform’s attention in February. Kalshi referred the matter to law enforcement, and the probe was first reported Tuesday.
The timing matters because Santos was already on notice when he took to X the day before the address and said he planned to attend President Donald Trump’s speech in person. He did not show up. Instead, he later said he was watching from an airport.
That sequence is now at the center of a question regulators are examining: whether trades on the prediction market reflected information Santos already had about his own plans. NPR reported that he had already placed bets on Kalshi that he would not appear at the event and turned a profit of tens of thousands of dollars. Kalshi and the CFTC declined to comment.
Santos said the investigations were “news to me” and would not say whether he had a Kalshi account, telling reporters he was “not saying yes” and “not saying no.” The gap between his public claim that he would attend and the bets placed around that decision is the friction point law enforcement is now testing.
The broader backdrop is a prediction-market industry under mounting scrutiny. Kalshi, Polymarket and other platforms have been pressed in recent months over whether users can profit from nonpublic information in markets tied to elections, military action and geopolitics. Kalshi has already fined and suspended three political candidates for betting on their own elections, while another platform flagged trades by a U.S. Army soldier accused of using classified information to make more than $400,000 on Venezuela-linked markets. Critics have also raised alarms over wagers tied to Iran.
For Santos, the investigation lands on top of a long record of legal and political trouble. He was expelled from the House in 2023 after scandals involving fabricated parts of his biography and allegations of financial misconduct. In 2024, he pleaded guilty to wire fraud and aggravated identity theft in a federal fraud case. Prosecutors said his broader misconduct included falsifying campaign finance reports, stealing donors’ credit card information, collecting unemployment benefits while employed and lying about his finances. He surrendered in July 2025 to begin an 87-month prison sentence, then was released in October 2025 after a commutation by Trump.
What regulators find next will determine whether this becomes a narrow trading probe or another chapter in the same pattern of deception that has followed Santos from Congress to court and now to Kalshi.
