george santos

NEW YORK — A prediction market reported former U.S. Rep. George Santos to federal prosecutors after he boasted he’d be going to President Trump’s State of the Union address, then bet against his own attendance, according to a person familiar with the investigation.

Kalshi, the online prediction marketplace, referred Santos to the Department of Justice after detecting suspicious trades made by him ahead of Trump’s Feb. 24 speech, the person said. The person spoke to the Associated Press on the condition of anonymity because they weren’t authorized to discuss the matter publicly.

Kalshi also reported the trades to the Commodity Futures Trading Commission, a federal regulatory body that has vowed to crack down on insider trading in prediction marketplaces.

The Justice Department and the CFTC didn’t immediately respond Tuesday to inquiries from the AP.

Santos also did not respond to text messages or phone calls.

The referral was first reported by NPR. Santos told NPR that he wasn’t aware of the investigation. He declined to say whether he had a Kalshi account.

“I’m not saying yes, I’m not saying no,” Santos told NPR.

The convicted ex-congressman had repeatedly discussed his intention to attend the State of the Union, which came just four months after he was granted clemency by Trump in a fraud case that led to his expulsion from the U.S. House.

On the eve of Trump’s speech, Kalshi put the odds of Santos attending at close to 75%.

Then, minutes into the speech, Santos posted on X that he had been waylaid at the airport. Immediately, several social media users accused him of running another scheme.

“Santos talking to his accountant and telling him to open his Kalshi account and bet all his money on No,” one user wrote, alongside a meme of Al Pacino counting money in the movie Scarface.

In March, Santos addressed the complaints on his podcast.

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

Santos, who won office as a Republican after inventing a bogus persona as a Wall Street dealmaker, was sentenced to seven years in prison after pleading guilty to fraud and identity theft in 2024.

After serving just 84 days, he was ordered released by Trump, who called Santos a “rogue” but said he didn’t deserve a harsh sentence and should get credit for voting Republican.

Prediction markets, including Kalshi and its chief rival Polymarket, have drawn scrutiny as their businesses have expanded — with some lawmakers urging the platforms to do more to guard against insider trading.

Both companies have said they are reporting suspicious trades to federal regulators. Some investigations have led to criminal charges. In April a soldier involved in the military operation to capture Venezuelan President Nicolás Maduro was charged with using classified information to win more than $400,000 predicting the date of his capture on Polymarket.

In April, the Senate approved a bipartisan resolution to prevent its own members from using prediction markets.

Offenhartz writes for the Associated Press.

WASHINGTON — Rep. Sheila Cherfilus-McCormick is resigning from Congress rather than be formally disciplined by the House as part of an ethics investigation into her use of campaign funds.

Explaining her decision in an extended social media statement on Tuesday, the Florida Democrat decried the internal investigation process as unfair. She said the House Committee denied her and her new attorney adequate time to prepare a defense.

“Rather than play these political games, I choose to step away,” she wrote.

Members of the House Ethics Committee on Tuesday had been set to weigh what punishment to recommend after they found she committed 25 violations of House rules and ethical standards, including breaking campaign finance laws.

Republicans had already called for the expulsion of Cherfilus-McCormick, who was in her third term and was running for reelection in a southeastern Florida district. She is also facing federal criminal charges accusing her of stealing $5 million in coronavirus disaster relief funds and using the money to buy items such as a 3-carat yellow diamond ring.

Cherfilus-McCormick has pleaded not guilty to the criminal charges and says she is not guilty of ethics violations, either.

The allegations against the congresswoman center on how she received millions of dollars from her family’s healthcare business after Florida mistakenly overpaid the business by roughly $5 million with COVID-19 disaster relief funds. She is accused of using that money to fund her 2022 congressional campaign through a network of businesses and family members.

Cherfilus-McCormick declined to testify during a previous Ethics Committee hearing, citing her Fifth Amendment right against self-incrimination. Her attorney, William Barzee, sparred with some of the lawmakers and argued that they should have allowed a thorough ethics trial, at which he could present witnesses and evidence to counter the conclusions of House investigators.

A group of supporters in Cherfilus-McCormick’s congressional district had weighed in on her behalf with the lawmakers who lead the Ethics Committee, urging committee leaders to proceed with caution.

“Our communities deserve stability. Our voices deserve to be heard. And our right to representation must be protected,” said one of the letters sent to the committee signed by about a dozen local faith leaders, union officials and others.

In all, the panel’s two-year investigation led to the issuance of 59 subpoenas, 28 witness interviews and a review of more than 33,000 pages of documents.

Rep. Greg Steube, a Florida Republican, had said he would move to expel Cherfilus-McCormick once the Ethics Committee made a determination on what punishment it would recommend.

That move could in turn prompt Democrats to seek the expulsion of Rep. Cory Mills, a Florida Republican who is the subject of a wide-ranging investigation by the Ethics Committee that includes whether he violated campaign finance laws, misused congressional resources and engaged in sexual misconduct or dating violence. That investigation is ongoing. Mills has denied any wrongdoing.

The focus on lawmaker wrongdoing comes just one week after two lawmakers resigned during ethics investigations into alleged sexual misconduct. Democratic Rep. Eric Swalwell of California and Republican Rep. Tony Gonzales of Texas headed off possible expulsion votes with their resignations.

House Democratic leaders had declined to condemn Cherfilus-McCormick, saying they wanted to see the ethics process play out. Potential punishments included a reprimand or a censure, which serve as forms of public rebuke. The committee could also have recommended a fine. The most severe form of punishment was expulsion, but the House has historically been reluctant to serve as the final arbiter of a lawmaker’s career, preferring to give that final say to the voters.

Only six members of the House have been expelled. The first three fought for the Confederacy during the Civil War and were expelled for disloyalty. The next two had been convicted of crimes. The final one was George Santos, the scandal-plagued freshman who was the subject of a blistering ethics report on his conduct as well as federal indictment. Santos, a New York Republican, served time in prison for ripping off his campaign donors before President Trump granted him clemency, and he has apologized to his former constituents.

Under the Constitution, at least two-thirds of the House has to vote for expulsion for it to occur, a high threshold that requires enormous bipartisan support.

House Speaker Mike Johnson (R-La.) told reporters last week he believes the House will move to expel Cherfilus-McCormick.

“The facts are indisputable at this point, and so I believe it’ll be the consensus of this body that she should be expelled,” Johnson said.

Freking and Groves write for the Associated Press.