Prediction Market Kalshi has taken action against three political candidates, alleging that each engaged in insider trading of information about their campaigns. The company implemented new rules last month aimed at preventing politicians and athletes from placing bets on events they could control, and said those guardrails helped flag this trio of cases.
The three candidates are Mark Moran of Virginia, Matt Klein of Minnesota and Ezekiel Enriquez of Texas. Kalshi settled with Klein and Enriquez, both of whom cooperated in the investigation of the forum. Each faces a fine of less than $1,000 and a suspension of up to five years. Disciplinary action was taken in Moran’s case, including a five-year suspension and a fine of more than $6,000. He posted on X about the situation and claimed it was essentially a stunt to see if he would get caught and “to expose how this company is destroying the youth.”
Kalshi and other prediction markets have been the subject of several lawsuits by state attorneys general attempting to regulate the sector as gambling. Cases are ongoing in Nevada, Arizona and New York, but state-level efforts are not looking promising. An appeals court ruled against New Jersey’s attempt to regulate this industry, and the US Commodity Futures Trading Commission has launched its own lawsuit in an effort to ensure that it will be the sole party regulating prediction markets.
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