Securities Regulation Daily Wrap Up, ENFORCEMENT—Kalshi permanently bans ex-rep George Santos over insider trading, (Sep 1, 2026)
Organizations Mentioned:U.S. House of Representatives
Santos bet on whether he would attend the 2026 State of the Union address, an outcome over which he had influence and about which he had material non-public information.
The Kalshi exchange has permanently suspended former congressman George Santos in connection with trades on his attendance at the 2026 State of the Union address. Kalshi said Santos broke exchange rules by trading on a market he could influence and made false public statements that manipulated contract prices. Kalshi also imposed a penalty of $71,356 (Notice of Disciplinary Action, George Anthony Devolder Santos, No. KDA-2026-0006 (Aug. 28, 2026)).
The Kalshi disciplinary order follows a settled CFTC enforcement action in July that imposed a $17,500 penalty and three-year trading ban against Santos based on the same conduct.
“Hey @Kalshi thanks for the lifetime ban from your gambling platform. Let’s see how much longer you guys are around for,” Santos posted on the X social media platform.
Kalshi enforcement head Robert Denault announced the order on X along with other disciplinary actions, stating, “All but one individual (George Santos) cooperated with our Compliance Department inquiries.”
Santos was expelled from the U.S. House of Representatives in 2023. He was sentenced to 87 months in prison in connection with multiple fraud convictions in April 2025, but his sentence was commuted that October by President Donald Trump.
Market manipulation. The Kalshi Compliance Department found that Santos placed a series of large trades in February 2026 in a market related to his attendance at the State of the Union (SOTU) address. He then made public statements regarding his planned attendance at the event, including false or misleading statements.
Kalshi found that Santos intended to manipulate the price of contracts he intended to purchase, and that the statements did in fact manipulate the price of the contracts.
Santos profited $17,839 from the trades, according to Kalshi.
Violations. Kalshi found that Santos violated several exchange rules:
Kalshi Rule 3.6(a), requiring cooperation with Kalshi investigations;
Kalshi Rule 5.17(n), prohibiting market manipulation;
Kalshi Rule 5.17(y), prohibiting trading on the basis of material non-public information about an underlying event;
Kalshi Rule 5.17(z), prohibiting trading on contracts where a member can influence the event outcome;
Kalshi Rule 5.17(cc)(a), prohibiting manipulative devices and schemes; and
Kalshi Rule 5.17(cc)(c), prohibiting acts, practices, and courses of business that operate as a fraud or deceit upon any person.
The case is No. KDA-2026-0006.
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