On Wednesday, Kalshi, a platform where users can wager on upcoming events, revealed that three candidates vying for seats in the US House and Senate were suspended and penalized for “political insider trading.”
Among those cited were Democratic Minnesota state Senator Matt Klein, a contender for the state’s 2nd District congressional seat; Ezekiel Enriquez, a former Republican candidate from Texas; and independent US Senate candidate Mark Moran from Virginia. Kalshi identified these individuals for placing bets on their own electoral outcomes.
Robert DeNault, Kalshi’s head of enforcement and legal affairs, explained in a statement that these incidents were flagged due to the platform’s newly implemented measures designed to prevent political figures from betting on their own elections.
“Much like in traditional stock exchanges, there are those who attempt to manipulate the system,” DeNault remarked. “Regulated platforms must continually enhance and adapt their mechanisms to counter insider trading risks.”
DeNault further noted that these cases illustrate how proactive technological strategies can uncover unlawful trading practices.
Klein, who had earlier co-authored legislation in Minnesota aimed at prohibiting prediction markets, confessed to placing a $50 wager on his success in the congressional primary.
“I had never wagered on a predictions market previously. I was curious about how it worked,” Klein told local outlet KARE 11, in a statement.
“This was a mistake, and I apologize,” he added.
Klein agreed to pay Kalshi a fine of $539.85 and he’ll be suspended from the platform for five years.
Moran also admitted to having bet on himself – after reading about prediction markets in The Post – but claimed he “wanted to get caught.”
“Finally, one of the moments I’ve been waiting for,” Moran wrote on X. “YES, I did bet ~$100 on myself on Kalshi because I wanted to get caught…”
“After discovering potential manipulation on polymarket in the NYC mayoral race (NY Post reported on this) I realized how rife with corruption kalshi is…I mean death markets…come on….” he added.
Moran explained that he wanted to see if Kalshi would “come after” him after placing the bet and experience what the company’s enforcement processes are like.
The Senate candidate declined Kalshi’s offer to settle his case for a small fine and suspension because he claimed the company also demanded that he make a public statement, which Moran argued violated his First Amendment rights.
“I traded $100 on myself, knowing this would happen (also knowing that I wouldn’t be vying for the democratic nomination) and the attention it would create to highlight how this company is destroying young men,” Moran said.
Enriquez, who received 1.4% of the vote in the GOP primary for Texas’ 21st Congressional District, placed a wager of less than $100 on his own candidacy and was subsequently fined $784 by Kalshi and suspended from the platform for five years after cooperating with the company’s investigation.
“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. “No matter how small the size of the trade, any trade that is found to have violated our exchange rules will be punished.”
He noted that “for more serious matters,” Kalshi refers cases to the Commodity Futures Trading Commission or the Justice Department for further investigation and prosecution.
