Former Rep. George Santos pays $35,000 in CFTC settlement over Kalshi SOTU trades
Former U.S. Rep. George Santos agreed to pay $35,000 to settle a CFTC enforcement action over trades he made on Kalshi about the State of the Union address. The settlement resolves the regulator's case against the expelled congressman for his activity on the regulated prediction market platform. The CFTC ordered the payment after finding Santos traded on Kalshi event contracts. The action comes as prediction markets and regulators face pressure to crack down on insider trading by political officials.
The Santos settlement turns a political scandal into a concrete CFTC enforcement precedent. For Kalshi, it validates the platform's surveillance and reporting systems: the trades were caught, reported, and resolved. For other elected officials, the $35,000 penalty establishes that congressional trading on event contracts carries real cost, not just headlines.
The CFTC now has two live official-trading cases in under two weeks, after the White House teleprompter probe. That momentum pressures Capitol Hill to act on pending legislation restricting political officials from prediction markets. Kalshi's cooperation in both cases buys regulatory goodwill, but it also proves the platform is a magnet for insiders with nonpublic information. The test for regulators is whether two cases signal a pattern or a pause.
Santos becomes the second elected or federal official disciplined for Kalshi trading in the regulatory crackdown that began with the White House teleprompter operator suspension eight days ago.