Federal authorities have launched an investigation into former Republican congressman George Santos due to questionable trading activities linked to his bets on attending President Trump’s State of the Union address. Data from Kalshi reveals that trading related to Santos constituted over 35% of the market's volume just a day prior to the event, with transactions exceeding $1.1 million on February 24, the day of the address.
The initial report by NPR highlighted insights from three individuals familiar with the trades. They alleged that Santos leveraged his social media following to influence market movements. While he publicly indicated his intention to attend, sources claimed he had already placed bets that would yield profits should he choose not to show up.
In response to the allegations, Santos issued a statement on social media asserting his innocence, calling the accusations absurd and expressing his willingness to cooperate with any inquiries from relevant agencies.
Santos mentioned that his legal team was in touch with the Department of Justice following the news of the investigation, promising to provide additional comments at the appropriate time.
On February 24, Kalshi traders placed over $7.8 million in bets regarding who would be present in the House chamber during the State of the Union. The trading volume had been building for days, with $520,095 on February 22 and $1.49 million the day before the speech. Santos became one of the most actively traded figures in this market.
On February 20, 9,166 shares of the Santos contract were traded, marking the highest volume for that day. Two days later, Santos-related trading accounted for $182,881, or 35.16% of the total daily volume of $520,095. On the day of the speech, Santos-related trading surged to $1,100,183, representing 14.09% of Kalshi’s total volume for that day.
Investigators are looking into whether participants had access to information not available to the general market. Just one day before the speech, Santos posted a video on X, stating, “I’m going to be there for the State of the Union in the gallery, guys,” which led to a swift market reaction, increasing the odds of his attendance from around $0.20 to $0.76.
However, sources indicated that Santos had already placed bets on not attending, and when he ultimately did not appear, those bets proved profitable. Allegedly, Santos made tens of thousands of dollars when the market settled.
Kalshi identified the suspicious trading patterns and subsequently froze Santos’ account, referring the matter to the Commodity Futures Trading Commission (CFTC) and the Department of Justice.