WASHINGTON, DC, OCT 29, 2026 — On Wednesday, Utah Attorney General Derek Brown’s office filed 14 criminal charges against prediction market Kalshi and its co-founders, Tarek Mansour and Luana Lopes Lara. The charges include a second-degree felony for a pattern of unlawful activity and 12 third-degree felonies for “online gambling promotion,” all built on 12 sports event contracts that an undercover state investigator bought on the platform in September for a total of $114.
The Consumer Choice Center calls the move a prohibition by indictment: felony charges against corporate founders, used to settle a jurisdictional fight that the federal courts and the Commodity Futures Trading Commission (CFTC) are already deciding. It is truly unprecedented.
“Utah can set whatever gambling laws it wants, but charging two founders with felonies over $114 in trades placed by the state’s own undercover agent isn’t law enforcement, it’s prohibition by indictment and an outrage. By Utah’s own estimate, Kalshi earned at least $30.5 million from Utah accounts this year. That represents adults choosing a highly regulated, federally supervised market. Using criminal law to prosecute the founders won’t make that demand disappear, but it will send trades offshore and a broad message to financial entrepreneurs to stay out of Utah,” said Yaël Ossowski, the Consumer Choice Center’s Deputy Director.
The charges came a day after the CFTC sued Utah. The agency argues that federal law gives it exclusive jurisdiction over event contracts traded on registered exchanges and overrides state gambling law.
“The attorney general says federal registration doesn’t put a company above the law, but nobody claimed that it did. The question is whose law governs a federally regulated exchange, and that question is before the federal courts right now. Utah shouldn’t attempt to answer it by weaponizing a jurisdictional dispute. Congress entrusted the CFTC to regulate event contracts and associated markets, and we predict that’s how this will end,” said Ossowski.
The Consumer Choice Center calls on Utah to drop the criminal charges against Kalshi’s founders and let the federal courts decide who regulates prediction markets.
Additional research on prediction markets can be found here.
The Consumer Choice Center is an independent, nonpartisan consumer advocacy group championing the benefits of freedom of choice, innovation, and abundance in everyday life for consumers in over 100 countries. We closely monitor regulatory trends in Washington, Brussels, Ottawa, Brasilia, London, and Geneva.
Find out more at ConsumerChoiceCenter.org