Three federal candidates have been suspended and fined by prediction market platform Kalshi after the company determined they had placed wagers on their own races — conduct Kalshi labeled "political insider trading" and said was detected through newly developed systems designed to prevent such activity.
The three candidates are Minnesota state Sen. Matt Klein, running in the Democratic primary for the state's 2nd Congressional District; Ezekiel Enriquez, a Republican who ran in the primary for Texas's 21st Congressional District; and Mark Moran, who had entered the Democratic primary for Virginia's U.S. Senate race before shifting to run as an independent. All three received five-year suspensions from the platform.
The fines issued were $539.85 for Klein, $784.20 for Enriquez, and $6,229.30 for Moran. Klein's and Enriquez's matters concluded as settlements following their cooperation with the company's investigation. Moran's case took a different path: though he initially admitted to the conduct, he subsequently cut off contact with Kalshi and declined repeated attempts to reach a settlement, resulting in a formal disciplinary action.
After learning from friends that a market had been created around his race, Klein placed a $50 wager on himself in October, he said in a post on X $TWTR. "I was curious about how it worked," Klein said. "This was a mistake, and I apologize." Enriquez's position was somewhat larger but still fell below $100, according to CNBC.
Speaking to NBC News, Moran said the wager was deliberate — a calculated act meant to expose how easily prediction markets can be influenced. "I wanted to get caught," he said. On X, Moran acknowledged placing a $100 bet on himself and framed Kalshi's response as a public relations move to redirect attention away from wider criticism of the industry.
In announcing the penalties, DeNault said the conduct at issue broke rules that the CFTC has approved for Kalshi's exchange. "Regardless of the size of a trade, political candidates who can influence a market based on whether they stay in or out of a race violate our rules," DeNault said. Neither the CFTC nor the Justice Department received a referral in connection with any of the three cases, Kalshi said.
The enforcement actions come as lawmakers from both parties have raised concerns about the potential for insider trading on prediction market platforms. Those concerns intensified after reports of well-timed trades on Kalshi and rival Polymarket ahead of U.S. military actions abroad. More than ten bills targeting prediction market regulation have been introduced in Congress since January, including a bipartisan measure that would bar CFTC-registered platforms from listing contracts resembling sports betting or casino gaming, according to prior coverage.
Wednesday's actions mark the second time this year Kalshi has moved against users for similar conduct. A February enforcement round resulted in the removal of an employee linked to YouTube star MrBeast as well as a California gubernatorial candidate who had wagered $200 on his own campaign, according to CNN. The fines collected from the three latest cases are expected to go to a nonprofit focused on consumer financial education.