George Santos agrees to $35,000 settlement in federal probe over Kalshi trades

NEW YORK (AP) — Disgraced former Congressman George Santos agreed Friday to pay $35,000 to settle a federal investigation into his suspicious trades on the prediction marketplace Kalshi after he bet against his own plans to attend President Donald Trump’s State of the Union.

The onetime Republican lawmaker from New York said he settled with the federal Commodity Futures Trading Commission to “put this matter behind him,” noting that he did not admit to doing anything wrong.

“He chose a prompt, practical resolution, rather than protracted, costly litigation, and that choice should not be mistaken for admission of any wrongdoing, because it is not one,” Santos’ lawyer Joseph Murray said in a statement Santos shared on X.

The commission said Friday’s settlement represents the more than $17,000 Santos earned from the unlawful trading as well as a fine of $17,500. The agency also imposed a three-year trading ban on Santos.

Kalshi, which had reported Santos to regulators, said it will also pursue its own enforcement action and work to reimburse traders if monetary penalties are recovered.

Leading up to Trump’s February speech, Santos had talked frequently about his plans to be in the crowd. But minutes into the speech, he posted on X to say that he had been waylaid at the airport and couldn’t make it to Capitol Hill.

Social media users called him out, noting that Kalshi had put the odds of Santos attending the address at close to 75%.

Santos shrugged off the complaints at the time.

“I guess people lost money,” he said on his podcast in March. “Some people made unexpected money. That’s to show you how fragile these markets are.”

But the federal probe into the Kalshi trading prompted rival online prediction platform Polymarket to cut ties with Santos in June.

Santos’ lawyer, in his statement Friday, said his client had a “genuine intention” to attend the State of the Union, even booking a hotel and plane ticket before a winter storm scuttled the plans.

“Mr. Santos concealed neither his intention to attend, nor his change of plans to not attend the SOTU, from anyone,” Murray said. “There was absolutely no intent to deceive any person, nor intent to manipulate any market.”

Santos, who is set to appear on Fox’s reality contest “Special Forces: World’s Toughest Test” this fall, shot to political fame after winning a seat representing parts of the New York City borough of Queens and Long Island.

But his bogus life story of being a wealthy Wall Street player with a college degree and other accomplishments quickly unraveled.

Santos was eventually expelled from Congress and charged with federal wire fraud and identity theft charges as investigators probed how he funded his campaign. He pleaded guilty and served less than three months of a more than seven-year sentence before Trump granted him clemency last year.

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Follow Philip Marcelo at https://x.com/philmarcelo.