Utah files criminal charges against Kalshi, executives over alleged illegal gambling

Utah has filed criminal charges against Kalshi and two of its executives for allegedly promoting illegal online gambling, escalating an ongoing legal battle between the state and the prediction markets platform.

Utah Attorney General Derek Brown filed the charges on Wednesday against Kalshi, CEO Tarek Mansour, and chief operating officer Luana Lopes Lara, accusing them of illegally promoting online gambling and letting an undercover agent place wagers.

"Gambling is illegal in Utah, whether you place the bet, run the game, or promote it. Calling it a 'prediction market' doesn't change what it is, and being federally registered doesn't put a company above the law," Brown said in a statement shared with The Block.

"This is a crazy overreach; Utah is clearly playing politics," a Kalshi spokesperson said. "We look forward to putting a stop to this in court, just like we did in Arizona."

The state's latest move comes after Brown sued Kalshi and two Susquehanna trading firms last week, accusing them of running an illegal gambling business in the state.

The Oct. 20 complaint argued that Kalshi violated Utah's gambling laws by letting Utahns bet on sports, elections, politics and other outcomes. The state said that calling bets "event contracts" does not change the nature of Kalshi's offerings. 

Meanwhile, the Commodity Futures Trading Commission sued Utah on Tuesday, arguing that the state was intruding on its jurisdiction over prediction markets.

"Congress entrusted the CFTC to be the federal regulator with sole responsibility to oversee these markets," CFTC Chair Michael Selig said in a statement. "As I've said before, the CFTC has the expertise and responsibility to defend its exclusive jurisdiction over commodity derivatives, and that’s exactly what we'll do."

The CFTC has sued at least 10 states, including Utah, as Selig seeks to assert the agency's oversight over prediction markets under the Trump administration.

Kalshi also previously sued Utah in February, seeking a federal court order to block the state from enforcing its gambling laws. However, a judge denied the request, ruling that the federal law cited by Kalshi did not prevent the state from enforcing its laws.

The article has been updated to add Kalshi's comment.