TLDR
- Utah filed 14 criminal charges against Kalshi and its two co-founders on October 28.
- The charges include 13 felony counts and one misdemeanor involving alleged illegal gambling.
- An undercover Utah investigator placed 12 sports trades totaling $114.87 on Kalshi.
- Utah Attorney General Derek Brown accused Kalshi of violating state gambling laws.
- Kalshi rejected the criminal charges and accused Utah officials of political overreach.
Utah prosecutors have filed 14 criminal charges against prediction market operator Kalshi and two executives, accusing them of breaking the state’s ban on online gambling. The October 28 filing adds a criminal case to the parties’ ongoing court dispute. The case names Kalshi co-founders Tarek Mansour, its chief executive, and Luana Lopes Lara, its chief operating officer. All three defendants face allegations, not findings of guilt.
Utah and Kalshi Face Criminal Charges
Attorney General Derek Brown filed 12 counts of online gambling promotion, one count alleging a pattern of unlawful activity, and one misdemeanor count of general gambling promotion. Thirteen charges are felonies under Utah law.
“Calling it a ‘prediction market’ doesn’t change what it is,” Brown said. Kalshi rejected the allegations, calling the prosecution a “crazy overreach” and saying Utah was “clearly playing politics.”
The charges come as Kalshi expands access to its markets. On October 23, crypto wallet Phantom began offering Kalshi event contracts to US customers, while limiting some categories in states where legal restrictions apply.
Undercover Bets Form Basis of Case
State investigators said an undercover agent created a Kalshi account using a Utah address, phone number, and debit card. The agent then placed 12 sports trades in September after confirming a location inside the state.
Court records show the trades covered football, baseball, soccer and hockey, with $114.87 put at risk. Prosecutors allege Kalshi collected fees from transactions that broke Utah’s gambling rules. The claims remain before the court.
Federal Regulator Sues Utah
On October 27, the Commodity Futures Trading Commission sued Utah and Brown, seeking to stop state enforcement against federally registered prediction exchanges. The agency says federal law gives it authority over the contracts Kalshi offers.
Utah brought a separate civil lawsuit on October 20. It asked a court to block Kalshi’s event trading in the state and recover profits. A federal judge had earlier declined to stop Utah from enforcing its laws.
Court Disputes Extend Beyond Utah
The national dispute also reaches professional sports. On October 26, the NBA announced a data-sharing agreement with the CFTC and named Kalshi and Polymarket preferred prediction exchanges. The NFL has backed state oversight. Arizona filed criminal charges against Kalshi in March, but a federal judge later paused that case. In Utah, the defendants have received summonses rather than arrest warrants.
