US regulators are investigating former congressman George Santos after prediction market platform Kalshi reportedly flagged suspicious trades in which Santos allegedly wagered against his own attendance at the State of the Union address. The Department of Justice and the Commodity Futures Trading Commission are both involved in the probe, suggesting potential criminal and civil exposure. The case highlights growing regulatory scrutiny of prediction markets, which have expanded significantly following Kalshi's legal victory allowing event-based contracts in the US. If Santos placed informed bets using non-public knowledge of his own plans, it could constitute market manipulation or fraud under CFTC jurisdiction. The investigation marks one of the first high-profile enforcement actions directly tied to a political prediction market.
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