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Kalshi дисципined two politicians

Kalshi announced penalties against two Republican figures over allegations of insider information or influence being used in political event contracts tied to U.S. politics. The platform's compliance team imposed a lifetime trading ban and a $71,356 fine on former House member George Santos, while Laurie Buckhout, who was running in North Carolina's 1st Congressional District, was handed a three-year ban and a $2,590 penalty.

According to separate settlement notices disclosed by the company on Friday, the sanctions followed investigations into whether both figures traded in event contracts that could be affected by their own actions. Kalshi said the move marks one of its toughest actions since it launched in 2021.

Which trades were at the center of the probe?

According to Kalshi, Buckhout was listed as a market option in a contract linked to the North Carolina congressional race after she announced her candidacy. Santos, meanwhile, was said to have traded in markets tied to his attendance at the February 2026 State of the Union address.

The platform's rules bar traders who have direct or indirect decision-making authority or influence over the underlying event from buying or selling in those markets. On that basis, the company concluded that both figures entered contracts over outcomes they could affect to a greater or lesser extent.

  • Buckhout was said to have cooperated with the investigation and accepted the sanction.
  • The notice released for Santos did not include a similar reference to cooperation.

Buckhout is still running as the Republican candidate for the 2026 midterm elections. Santos was expelled from Congress in December 2023 after fraud allegations surfaced while he represented New York's 3rd Congressional District.

Market impact watched as regulatory pressure builds

The decision came as debate intensified over whether prediction-market platforms are vulnerable to manipulation. Kalshi was previously fined $172,000 by federal regulators after Gabriel Perez, President Donald Trump's teleprompter operator, was found to have traded in event contracts tied to Trump's speeches.

Platforms such as Kalshi and Polymarket are also facing lawsuits from some state gaming regulators, who allege they are facilitating illegal sports betting. Even so, Michael Selig, the chair of the CFTC (Commodity Futures Trading Commission), argues that the agency has exclusive authority over prediction markets and says legal action will be taken against state intervention.

Election contracts kept trading

As of Tuesday, contracts linked to Buckhout's race were still listed on Kalshi. Pricing on the platform showed a 63% probability for Democratic incumbent Don Davis and 41% for Buckhout, suggesting the disciplinary action did not fully remove the race from market view.

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