Utah charges Kalshi founders over sports betting
The case adds to Utah’s efforts to restrict prediction markets, with prosecutors alleging that 12 sports wagers violated state gambling laws.
Key takeaways:
- Utah filed 14 criminal charges against Kalshi and its co-founders, Tarek Mansour and Luana Lopes Lara.
- The case includes 13 felony counts linked to alleged gambling promotion and unlawful activity.
- The wagers covered NFL and college football, Major League Baseball, Major League Soccer and an NHL game.
U.S.- Utah Attorney General’s Office has filed 14 criminal charges against Kalshi, accusing the prediction market operator of violating state gambling laws by allowing users to wager on sporting events. The case includes 13 felony counts involving the company and its founders, Tarek Mansour and Luana Lopes Lara.
According to the charging documents, an attorney general’s office agent opened a Kalshi account using a Utah address, a local phone number, and a state-issued debit card. After confirming the account’s location through location services, the agent placed 12 sports-related wagers over approximately two weeks, totalling a transaction of US$114.87 and resulting in a net loss of US$25.10.
The bets covered several competitions, including NFL and college football, Major League Baseball, Major League Soccer and an NHL game between the Utah Mammoth and the Colorado Avalanche.
The agent correctly predicted six of the 12 outcomes. Successful predictions included the Utah Utes’ margin of victory against Utah State, Atlanta Falcons quarterback Michael Penix Jr.’s passing yards and the total points scored in an NFL game between the Philadelphia Eagles and Tennessee Titans.
Each of the 12 wagers forms the basis of an alleged online gambling promotion offence, classified as a third-degree felony under Utah law, according to the filing. The charges also include allegations of a pattern of unlawful activity and general gambling promotion, the latter classified as a misdemeanour.
Mansour and Lopes Lara were summoned to appear before Utah’s Third District Court in Salt Lake County to respond to the charges.
Last week, Utah Attorney General Derek Brown filed a complaint against Kalshi to Utah’s Third District Court, seeking up to US$61.2m in restitution and other financial remedies. Brown’s office alleges that Kalshi began offering markets to Utah users by September 2024, despite knowing that the activity violated state law, and generated between US$30.6m and US$61.2m in fees from accounts in Utah, where users placed trades worth a combined US$3bn. The filing states that at least 32,000 residents have used the platform.
The state wants Kalshi to stop offering event contracts related to sports, politics, elections and culture to Utah residents. Brown’s office is also seeking geographic restrictions on access to the platform and the recovery of profits it says were obtained through illegal transactions.
Frequently asked questions (FAQs)
- Why has Utah charged Kalshi and its co-founders?
- Utah alleges that Kalshi violated state gambling laws by allowing users to wager on sporting events through its prediction market platform.
- How is the criminal case related to Utah’s US$61.2m lawsuit against Kalshi?
- The criminal proceedings are separate from the civil complaint filed on 20 October, which seeks up to US$61.2m in restitution and other remedies over alleged unlawful activity involving Utah users.
