Kalshi’s two co-founders have been summoned to appear in a Utah criminal court next month. Chief executive Tarek Mansour and chief operating officer Luana Lopes Lara, along with the company, have been ordered to appear before a judge in Salt Lake City’s Third District Court in December, FOX 13 reported. The two were issued summonses rather than arrest warrants.
It is the first time a state has taken criminal action against the people who run a prediction market regulated by the federal Commodity Futures Trading Commission (CFTC), rather than suing the company alone.
The charges
Utah Attorney General Derek Brown filed the case in state court on October 28 against KalshiEx LLC, Mansour and Lopes Lara. FOX 13 and Reason report the same 14 counts for each defendant: one second-degree felony for a pattern of unlawful activity, 12 third-degree felonies for promoting online gambling and one misdemeanor for promoting gambling.
The case rests on an undercover account. According to the charging documents described by Reason and FOX 13, a state investigator opened a Kalshi account with a Utah address, phone number and bank card, then spent $114.87 on 12 sports contracts over about two weeks, covering NFL, MLB, college football and a Real Salt Lake soccer match. Online gambling of any kind is illegal in Utah.
Kalshi called the case “a crazy overreach” in a statement to FOX 13 and said it would fight it in court, pointing to Arizona, where it won a federal ruling against that state.
The federal fight
The charges sit inside a wider legal battle. In August, US District Judge Robert Shelby ruled that federal commodities law does not stop Utah enforcing its gambling laws against Kalshi, and in September the 10th Circuit refused to pause that ruling while Kalshi appeals.
On October 26 the CFTC and the Justice Department sued Utah, and on October 29 they asked Judge Shelby for a temporary restraining order that would bar the state from criminal or civil cases over CFTC-listed event contracts. The judge set a conference for November 6. No ruling had been reported by November 8, so the December court date stands for now.
Other prediction market operators have already pulled back. DraftKings stopped offering sports and certain other event contracts in Utah, and Fanatics said it would stop offering contracts there on November 4, according to FOX 13 and CDC Gaming. The case follows other state moves, including Ohio’s cease-and-desist letters and the Ninth Circuit’s refusal to rehear Kalshi’s Nevada case, and comes days after the CFTC’s November 5 guidance on geofencing.
What it means for players
If you live in Utah, there is still no legal way to bet on sports online, through a sportsbook or a prediction market. The state’s case says using sports contracts from Utah breaks state law, and operators are increasingly blocking the state.
Elsewhere, the case is a reminder that prediction markets and state-licensed sportsbooks are not the same thing. A licensed sportsbook follows your state’s rules on age checks, limits and complaints, while an event contract falls under federal rules that states are contesting. Check what is legal where you are on our US sports betting legal map, and see our US betting sites guide for licensed options. Our responsible gambling page lists free support if betting is becoming a problem.
Sources
- Utah levels criminal charges against Kalshi and some of its executives (FOX 13 Salt Lake City)
- Other predictive markets pull out of Utah after Kalshi criminal charges (FOX 13 Salt Lake City)
- Utah files criminal charges against Kalshi co-founders (Reason)
- Utah files criminal charges against Kalshi and its founders (Deseret News)
- Fanatics to shutter predictions in Utah (CDC Gaming)
Written in our own words from the sources above. Spotted an error? Tell us and we will correct it and log it on our corrections page.
About the author
The BettingSeeker News Desk covers regulation, operator news and safer gambling developments in the UK, the US and Canada. Every story is based on primary sources such as regulator announcements, government publications and company filings, or on reporting by established news outlets, and every source is linked at the end of the article.
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