for early access to the latest igaming videos!
and get the latest igaming news first!
A former White House teleprompter operator must surrender more than $107,000 in trading profits and pay a further $65,000 penalty after U.S. regulators found he used advance access to President Donald Trump’s speeches to trade prediction market contracts.
The Commodity Futures Trading Commission announced the settlement on August 28, closing its enforcement action against Gabriel Perez over trades made while he worked in the federal government.
Perez agreed to disgorge $107,539.02 and pay a civil monetary penalty of $65,000. He also accepted a three-year ban from trading in markets regulated by the CFTC.
The case offers an unusually direct example of how government access can be turned into an advantage in prediction markets, where contracts can depend on events as narrow as whether a president uses a particular word.
Speech access became a trading advantage
Perez worked as a White House teleprompter operator between December 2025 and February 2026. During that period, he traded presidential mention contracts whose outcomes depended on words or phrases appearing in Trump’s speeches.
His job gave him access to the speeches before they were delivered publicly.
The CFTC concluded that Perez used that nonpublic information for personal trading, violating his duty of trust and confidence. The trades generated more than $107,500 in profits.
Perez is no longer employed by the federal government. He had previously been placed on unpaid leave as questions emerged over his trading activity.
The regulator reduced his financial penalty under its cooperation policy, citing his conduct during the investigation. KalshiEX, where the activity was examined, also received credit from the CFTC for assisting the inquiry.
Insider trading concerns spread across prediction markets
Perez’s case is not isolated. Prediction markets have increasingly faced the same problem long associated with conventional financial markets: some participants may know the outcome before everyone else.
A separate federal case involves U.S. Army Master Sergeant Gannon Ken Van Dyke, who has been accused of using classified military information to trade Venezuela-related contracts on Polymarket.
Prosecutors allege he made about $409,881 from 13 trades after investing more than $33,000. Van Dyke has pleaded not guilty and disputes whether the contracts in question legally qualify as swaps.
A federal judge paused the CFTC’s civil case against him in August while the related criminal proceedings continue.
Kalshi has dealt with its own internal cases. Earlier this year, the platform penalized and suspended for two years an editor connected to YouTube creator MrBeast after finding that confidential information had been used to trade contracts linked to MrBeast content. The case also involved a failure to cooperate with the platform’s investigation.
Elsewhere, Polymarket referred nearly 100 wallets for further examination after a review identified patterns associated with potentially informed trading. Those referrals do not establish wrongdoing, and no charges automatically follow from a suspicious trading pattern.
Platforms tighten surveillance
The industry has responded by building more controls around traders who may have privileged access to information.
In June, Kalshi began requiring employer disclosures from users trading in certain higher-risk markets. The information is intended to help compliance teams identify potential links between a trader’s job and the subject of a contract.
The company later added StarCompliance tools used by financial firms to monitor employee trading. Its broader surveillance system includes whistleblower reporting, market risk assessments and technology designed to identify unusual activity.
The CFTC has also moved to address how prediction market products are presented to customers. In August, agency staff warned regulated exchanges against displaying event contracts in a way that could make them appear indistinguishable from traditional sportsbook wagers.
A market under pressure from several directions
The Perez settlement lands while prediction markets remain caught in a wider legal battle over who has the authority to regulate them.
The CFTC treats federally listed event contracts as falling under its jurisdiction. Several states, including New York and Nevada, have challenged that position, particularly when the contracts concern sports and resemble gambling products.
The dispute has produced conflicting legal arguments and court battles over the boundary between federal commodities regulation and state gambling law.
In August, the CFTC used emergency authority to allow KalshiEX to continue operating after New York sought restrictions against the exchange. The agency maintained that federal derivatives law gives it exclusive authority over event contracts traded on registered exchanges.
That broader fight is still unfolding.
Perez’s case, though, is settled. The profits are being returned, the penalty has been imposed and he will remain barred from CFTC-regulated trading for three years.
For a market built around predicting what will happen next, the enforcement action exposes a simpler problem: some traders may not be making predictions at all.
Source: crypto.news
