Former U.S. Representative George Santos has agreed to pay more than $35,000 to settle Commodity Futures Trading Commission (CFTC) allegations involving trades on the prediction market platform Kalshi, a CFTC-regulated exchange that lists event contracts on real-world outcomes. The settlement requires $17,569.98 in disgorged trading profits and a $17,500 civil monetary penalty, totaling $35,069.98. The CFTC order also imposes a three-year ban barring Santos from prediction market trading.

Regulators say Santos traded contracts tied to his attendance at President Donald Trump's February State of the Union address. The CFTC alleges that his social media posts omitted key travel changes while market prices moved in his favor. Santos settled without admitting or denying the agency's findings, according to his lawyer.

Kalshi reported the activity itself after its surveillance systems flagged the trades.

Settlement Details and Trading Sequence

According to the CFTC, Santos first purchased positions predicting he would attend the address. He then posted about his clothing choices for the event, after which the contract price rose, allowing him to close the position at a profit.

For the reporters here are the only comments you'll get on this matter. pic.twitter.com/fn5TGNUBKr

— George Santos (@Georgesantos) July 31, 2026

Travel complications subsequently altered the situation. A winter storm disrupted Santos's flight to Washington, a delay he discussed online. His lawyer stated that Santos had booked a flight and hotel and had planned to attend.

The CFTC says Santos then shifted toward contracts predicting he would not attend and canceled a train reservation. However, regulators allege he did not disclose that cancellation while continuing to post about his travel prospects.

Minutes into the speech, Santos announced he was stranded at the airport and would miss the event. The market moved sharply following that post. Regulators say the later position generated nearly $14,400, while the full trading sequence produced $17,569.98 in total profits.

The settlement requires Santos to surrender those profits and pay the $17,500 civil penalty.

Attorney Joseph Murray described the agreement as a practical resolution to avoid lengthy litigation and stressed that Santos admitted no wrongdoing. Murray denied any intent to deceive traders or manipulate prices, stating that the State of the Union contract marked Santos's first prediction market wager. He maintained that changing weather conditions, not a trading plan, forced the attendance reversal.

The CFTC order nonetheless treats the social media posts, omissions, and trades as connected conduct.

Kalshi Referral and Broader Prediction Market Scrutiny

Kalshi said its surveillance systems flagged the Santos activity and referred the matter to regulators. Robert DeNault, the exchange's enforcement chief, said the company supplied evidence supporting the CFTC action. The platform now plans separate enforcement under its own rules and said it would seek to reimburse affected traders if its process recovers monetary penalties. That step remains separate from the CFTC settlement.

The case arrives as prediction markets face growing scrutiny over traders who can influence contract outcomes. Political figures may have knowledge of private schedule changes before other market participants, and their public statements can move prices when contracts concern their own actions. The Santos matter highlights an enforcement frontier distinct from traditional insider trading: regulators examined whether selective disclosures and omissions by the very subject of a contract constituted market manipulation.

The CFTC has pursued other event-contract cases during 2026. In May, the agency charged a Google employee over alleged insider trading linked to Year in Search results, seeking disgorgement, penalties, and trading bans.

Separately, the regulator continues defending federal authority over event contracts against state challenges. Those disputes center on whether certain contracts resemble gambling. The Santos matter, by contrast, focuses on market conduct on Kalshi.

Santos's lawyer said the settlement should not be treated as an admission of wrongdoing. The order nonetheless imposes a three-year trading ban and creates an enforcement record tied to statements made during an active contract.

George Santos represented Queens and Long Island in Congress before the House expelled him in 2023. He later pleaded guilty to wire fraud and aggravated identity theft. President Trump commuted his prison sentence in October 2025.