DOJ probing former Rep. Santos for alleged insider trading on Kalshi
The Department of Justice is investigating former U.S. Rep. George Santos for alleged insider trading on prediction market platform Kalshi, according to a June 2, 2026 report. The investigation centers on whether Santos used non-public information to trade on Kalshi contracts. The case follows closely on a separate probe involving a White House staffer and alleged insider bets on the same platform. Kalshi faces mounting federal scrutiny even as it battles state enforcement actions across multiple jurisdictions.
For Kalshi, this probe compounds an already catastrophic week. The platform is fighting state enforcement in New York, Michigan, Illinois, and Minnesota while defending its sports contracts against a bipartisan Senate ban bill. A second federal insider-trading scandal on its own market, following the White House teleprompter case, undermines the compliance narrative Kalshi sells to regulators and lawmakers. The CFTC must now assess whether Kalshi's surveillance caught either scheme, or whether monitoring gaps allowed government insiders to exploit political event contracts repeatedly.
Any finding of weak controls strengthens state attorneys general who argue CFTC oversight is insufficient. Kalshi's legal and compliance budgets now stretch across six simultaneous fights. Competitors will cite both cases as proof that political event contracts carry unique information-asymmetry risks that federal registration alone cannot contain. The first enforcement finding against Kalshi's surveillance will set the standard every platform must meet.