Topline
Federal authorities are reportedly investigating former Rep. George Santos, who repeatedly claimed on social media he would attend the State of the Union in February and then bet against his own attendance on the Kalshi prediction market in an apparent bid to score money.
Key Facts
Kalshi reported Santos to federal authorities, multiple outlets reported, with the New York Times reporting the Commodity Futures Trading Commission, which regulates prediction markets, had opened an investigation into Santos’ Kalshi bid.
One day before the State of the Union address in February, Santos explicitly stated in a video on X: “I’m going to be there for the State of Union in the gallery, guys,” clarifying he is able to visit the House floor when it is not in session after his expulsion from Congress and stint in federal prison.
Leading up to the address, Santos continued to claim on X he would attend, asking followers in one post whether he should wear a “muted serious suit to the SOTU or a bedazzled one,” responding “Aye!” to a user who asked whether he would attend, claiming in another post he would be present in the gallery and detailing his “trip to DC” in other posts.
Santos, on the evening of the State of the Union, posted on X he actually would not attend: “Watching SOTU from an airport tv was not part of the plan! FML.”
Some X users immediately accused Santos of deliberately scheming the prediction market odds, with one accusing him of “lying about how he was going” so he could “bet all his money on ‘No.’”
In response to NPR, which first reported the news of Santos’ suspicious Kalshi bets, Santos said the investigation is “news to me,” adding, “I’m not saying yes, I’m not saying no,” when asked if he has a Kalshi account.
What Is The Status Of The Santos Investigation?
Details of the probes into Santos’ Kalshi bet are unclear (Forbes has reached out to both the Department of Justice and the Commodity Futures Trading Commission for comment). Santos told NPR a co-founder of Kalshi, Luana Lopes Lara, is a “fellow Brazilian” whom he knows personally, and he told the outlet he would call her to inquire about the investigation. NPR said Santos had promised to update the outlet on how that call went, but he did not respond to NPR’s messages.
How Did Santos’ Posts Impact The Prediction Market?
Kalshi users wagered more than $15 million predicting whether a number of political figures would attend President Donald Trump’s State of the Union address in February, including members of Congress and the Supreme Court, as well as other business and entertainment figures like David Ellison, Nicki Minaj and Jensen Huang. Santos’ odds to attend the address were initially low, but his odds surged two days before the event as he began to repeatedly post that he would show up. Within minutes of Santos’ post on the evening of the address claiming he was held up at the airport, his odds to attend plummeted.
Key Background
The State of the Union address took place just four months after Santos was released early from federal prison. Santos, who was convicted of identity theft and wire fraud in 2024 and began a seven-year prison sentence in July, was released in October after President Donald Trump commuted his sentence. Trump announced he would sign a commutation in a post on Truth Social, acknowledged the former congressman was “somewhat of a ‘rogue,’” but praised him for having the “Courage, Conviction, and Intelligence to ALWAYS VOTE REPUBLICAN!” Santos, who was elected to represent one of Long Island’s congressional districts in 2022, served less than a year in Congress before his expulsion over alleged financial misdeeds, like spending campaign funds on Botox and OnlyFans purchases. Prior to his expulsion, much of Santos’ background came under scrutiny, including extensive lies about his resume and personal life.
Tangent
The investigations into Santos’ Kalshi bet come as the prediction market and its biggest competitor, Polymarket, face increased scrutiny by U.S. regulators, particularly over insider trading. Rep. James Comer, R-Ky., who chairs the House Oversight and Government Reform Committee, said in May he sent letters to the chief executives of both prediction markets to request information about how they detect “anomalous trading activity to prevent insider trading.” In April, Kalshi fined and suspended three congressional candidates who bet on their own elections, while some bets on Polymarket over the Iran war and the ousting of Venezuela’s Nicolás Maduro have drawn allegations of insider trading.
Further Reading
Dozens of Polymarket Bets Show Signs of Insider Trading, The Times Finds (New York Times)
