Former congressman George Santos agreed to a $35,000 settlement in response to a federal investigation into his trading activities on the prediction marketplace Kalshi. The investigation arose after Santos bet against his plans to attend President Donald Trump’s State of the Union address.
Santos, once a Republican lawmaker from New York, announced he settled with the Commodity Futures Trading Commission to resolve the issue, while maintaining that he did nothing wrong. His attorney, Joseph Murray, emphasized that the settlement was chosen as a practical resolution and did not imply any admission of wrongdoing.
The settlement consists of over $17,000 in earnings from the trades and an additional $17,500 fine. Santos also faces a three-year ban from trading. Kalshi, the platform involved, intends to pursue its own actions and aims to reimburse other traders if penalties are recovered.
Leading up to Trump’s speech, Santos publicly declared his intent to attend. However, he later posted that he missed the event due to being stuck at the airport. This led to online scrutiny since Kalshi had favored his attendance at 75% odds.
“I guess people lost money,” Santos commented on his podcast, highlighting market volatility.
The controversy led Polymarket, another prediction platform, to sever ties with Santos in June.
Santos, represented by Murray, reiterated the genuine intent to attend the State of the Union. Travel plans affected by weather, according to his lawyer, were not intended to deceive or manipulate any markets.
Santos, who gained political notoriety after winning a seat in New York, faced further discrediting after false claims about his background emerged. Additionally, he faced federal charges for wire fraud and identity theft related to campaign funding. He served under three months of a sentence before President Trump granted him clemency.
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