The Utah Attorney General's office has filed 14 criminal charges against the prediction market platform Kalshi and its co-founders, Tarek Mansour and Luana Lopez Lara. The charges include 12 counts of promoting online gambling and one count of systematic illegal activity, with 13 of the total charges classified as felonies.
The legal action follows a sting operation conducted by a special agent who registered on the platform using a Utah address and bank details. Between September 13 and 24, the agent executed 12 sports betting contracts totaling $114.87, resulting in a loss of $25.10. The platform collected commissions ranging from $0.03 to $0.78 per transaction.
This criminal case follows a civil lawsuit filed by Utah on October 20, which seeks to ban sports and political betting markets in the state and recover $30-60 million in alleged illegal profits. Kalshi maintains that its contracts are financial derivatives regulated by the CFTC, while Utah authorities argue that federal registration does not exempt the company from local gambling laws.
The CFTC has intervened in the dispute, filing a lawsuit against Utah on October 27 to prevent the state from applying its gambling laws to federally registered platforms. The federal regulator asserts that it holds exclusive authority over event contracts. Meanwhile, Kalshi has vowed to contest the charges, labeling the state's actions as an overreach.
