Feds Investigate George Santos for Insider Trading After He Allegedly Bet Against His Own State of the Union Appearance
The disgraced former New York congressman, freed early after President Trump commuted his fraud sentence, is under Justice Department and CFTC scrutiny over tens of thousands of dollars in suspicious Kalshi bets, three people familiar with the trades say.
Federal authorities are investigating former Rep. George Santos for alleged insider trading on the prediction market Kalshi, scrutinizing bets the disgraced New York Republican placed on whether he would attend President Donald Trump's State of the Union address, according to three people with direct knowledge of the trades who were not authorized to speak publicly.
The episode unfolded in February, roughly four months after Santos walked out of federal prison. He had been sentenced in 2025 to more than seven years for wire fraud and aggravated identity theft, only to have Trump commute the sentence and order his release. Within weeks of regaining his freedom, Santos was back on social media, posting a video in which he gushed about his plans to attend Trump's address to a joint session of Congress.
At the time, traders on Kalshi were wagering millions of dollars on which public figures would show up. Santos' video, confirming he would be in the chamber, sent the "yes" odds on his attendance soaring. What he did not disclose, the people said, was that he had already bought up "no" contracts betting that he would not appear. He never showed. When the dust settled, Santos had pocketed a profit in the tens of thousands of dollars off a public statement that contradicted his own private bets.
Kalshi's surveillance systems flagged the trades, the company froze Santos' account, and it referred the matter to the Commodity Futures Trading Commission and the Department of Justice, the people said. Neither agency has filed charges, and an investigation does not imply wrongdoing has been proven. A spokesperson for Santos did not immediately respond to requests for comment, and the CFTC and DOJ declined to comment.
The case lands at a combustible moment for the prediction-market industry. Platforms like Kalshi and Polymarket have exploded in popularity, drawing hundreds of millions of dollars in wagers on elections, court rulings, sporting events and Washington minutiae. Lawmakers from both parties have warned that the markets are vulnerable to manipulation by insiders who can move odds with a well-timed post or leak, then cash in before the public catches up — precisely the dynamic regulators allege Santos exploited.
Santos, who was expelled from the House in December 2023 after a damning ethics report, has spent the years since cultivating an online persona built on provocation and self-promotion. Whether his Kalshi maneuver amounts to a prosecutable offense remains an open question; prediction-market contracts occupy a contested legal space, and the CFTC is still defining how insider-trading rules apply to them. For Santos, though, the investigation revives the specter of the courtroom barely a year after a presidential commutation set him free.
Originally reported by CNN.