The Commodity Futures Trading Commission has opened an investigation into former US Representative George Santos for manipulative trading, adding yet another legal headache to a man who has become something of a collector.
The investigation stems from Santos’s trading activity on Kalshi, the CFTC-regulated prediction market platform where users can place bets on real-world events, including political outcomes. Santos allegedly made public statements about attending the State of the Union address while simultaneously placing opposing bets on the platform, a move that would allow him to profit when reality contradicted his own words.
The prediction market play
The scheme, as alleged by regulators, was straightforward. Santos made misleading public statements suggesting he would attend the State of the Union. Meanwhile, he placed bets on Kalshi that contradicted those very statements.
Kalshi identified unusual patterns in Santos’s trading activity, froze his account, and referred the matter to both the CFTC and the Department of Justice.
