The CFTC orders ex-GOP Rep. George Santos to pay $35,000 over trades on Kalshi

• Santos publicly stated 'I'm going to be there for the State of Union in the gallery' the day before the address, causing contract prices to move favorably for his positions
• The penalty includes a $17,500 civil monetary fine plus disgorgement of $17,569.98 in trading profits he made from the event contracts
• Santos, who was previously sentenced to 87 months for wire fraud and aggravated identity theft (later commuted by President Trump), agreed to not further violate the Commodity Exchange Act

CFTC Orders Former Rep. George Santos to Pay $35,000 Over Kalshi Trading Violations

The Commodity Futures Trading Commission (CFTC) has penalized former Republican congressman George Santos with $35,000 in total payments following findings that he illegally traded on insider information.

Key Details:

Santos must pay a $17,500 civil monetary penalty and forfeit $17,569.98 in trading profits. He is also banned from trading for three years and agreed not to violate the Commodity Exchange Act or CFTC regulations going forward.

The Violation:

In February, Santos traded on Kalshi event contracts related to the State of the Union address, including one specifically asking whether he would attend the event. The day before the address, Santos publicly stated on social media that he would attend, posting "I'm going to be there for the State of Union in the gallery, guys." He later posted he was watching from the airport.

According to the CFTC, contract prices moved favorably following these posts, allowing Santos to profit over $17,500 from positions taken with material, non-public information about his own attendance.

Background:

Santos was expelled from the U.S. House of Representatives and was previously sentenced to 87 months in prison for wire fraud and aggravated identity theft. However, President Donald Trump commuted his sentence last fall.

Market Implications:

This case highlights regulatory scrutiny of prediction market platforms like Kalshi and establishes precedent for enforcement actions against traders using insider information on event contracts, particularly those involving personal knowledge of outcomes.

*Note: CNBC disclosed a commercial relationship with Kalshi including customer acquisition and minority investment.*