George Santos Denies Insider Trading Allegations Amid Federal Investigation

Former Republican Representative George Santos has denied allegations of insider trading after a prediction market reported his activities to federal authorities. The report from Kalshi, an online platform, indicated that Santos was flagged after he publicly announced plans to attend President Donald Trump’s State of the Union address but allegedly bet against his appearance.

Background of the Allegations

Kalshi reported Santos to federal prosecutors on Tuesday. This action followed Santos’ public declarations regarding his attendance at Trump’s State of the Union address in February. The platform claimed that Santos bet against his own presence, raising questions about possible insider trading.

Representing New York’s 3rd Congressional District at the time, Santos stated that he first became aware of the Department of Justice’s interest through an NPR report. He mentioned that his legal team is now communicating with officials to clarify the matter. Santos dismissed the allegations as “preposterous” and expressed his willingness to cooperate with any investigations.

Reason for the Investigation

Santos comes under scrutiny after Kalshi flagged his trading activities to federal authorities. The focus is on potential insider trading, with the DOJ and Commodity Futures Trading Commission being notified. Authorities are considering whether Santos manipulated market outcomes using nonpublic or self-generated information.

This inquiry arises amid increased regulation of prediction markets, which legislators and regulators worry could be manipulated by individuals with insider knowledge.

Core of the Allegations

The charges suggest that Santos claimed he would attend the State of the Union address while betting he would not appear. A source familiar with the investigation told the Associated Press that his trades before the speech raised concerns, as they seemed to contradict his public statements.

The investigation seeks to determine whether Santos’ statements influenced market odds for personal gain. This development adds to criticisms of prediction markets being susceptible to exploitation by those with privileged or self-generated insights.

George Santos’ Official Response

On Wednesday, Santos posted on X, “To the 100’s of reporters calling me through the night. Stop! My legal team and I were made aware by a report from NPR yesterday that the DOJ might be looking into me. So now my legal team is in contact with the DOJ to see what is going on. I will comment further when appropriate and clarify everything accordingly while being mindful and respectful of any process that might be underway. The bases of the accusation is preposterous and I look forward to supplying any information asked of me to any agency that inquires, till then media please do not inquire.”

Past Legal Challenges

Santos faced federal charges in 2023 for wire fraud, identity theft, and financial misconduct linked to his congressional campaigns. These accusations included fabricating his background and misusing donor funds, resulting in his expulsion from the U.S. House of Representatives.

In 2024, Santos pleaded guilty and received a sentence of more than seven years in prison. His downfall was notable, as his résumé and personal history were exposed as fraudulent post-election.

Clemency and Current Status

Though Santos was not officially pardoned in 2024, he received clemency from Donald Trump in October 2025. Trump authorized his release after Santos served a short part of his sentence. Trump described Santos as “rogue” but suggested the punishment was excessive.

Critics disapproved of the clemency, given Santos’ expulsion and conviction. Nonetheless, this decision facilitated his return to public life and political engagement.