Federal regulators are investigating Gabriel Perez, a White House teleprompter operator, for allegedly betting on President Donald Trump's public remarks on the prediction market Kalshi.
Kalshi said its surveillance in March flagged trades on contracts tied to Trump's public statements, referred the trades to the Commodity Futures Trading Commission and froze most of the more than $90,000 in profits, Robert DeNault, Kalshi's head of enforcement, said. "Our surveillance team promptly flagged and referred these trades to the [Commodity Futures Trading Commission] after an exchange investigation," DeNault said. "We have been assisting regulators on this matter and provided evidence we collected, as we do in any referral."
Sources said Perez is in talks with federal regulators to settle allegations that he used inside knowledge to win more than $100,000 by placing bets on more than a dozen Trump speeches over a three-month period, including the State of the Union address in February, a December primetime address, a January speech at the World Economic Forum in Davos, Switzerland, and Trump's remarks in March during a Medal of Honor ceremony.
Sources familiar with the investigation said Perez sat for an interview with regulators in recent months and acknowledged some of the trades, and that the CFTC alerted federal prosecutors in Manhattan, who declined to open a criminal investigation.
"The White House has strict ethics guidelines that we expect all staffers and officials to follow," White House spokesperson Davis Ingle said. "The staffer in question is fully cooperating with the CFTC."
Kalshi has a policy against users placing bets based on information obtained as part of their jobs and last month updated its rules to require users to disclose their place of employment; Bobby DeNault said in May, "If you have information by virtue of your job or your employment, something that you have a legal duty surrounding, and you have an obligation not to take that, misappropriate it for yourself."
The Department of Justice brought two cases of alleged insider trading on prediction markets in recent months, involving a special forces soldier who allegedly bet on the capture of Venezuelan President Nicolás Maduro and a Google employee who allegedly bet on user searches using internal company data; both defendants pleaded not guilty.
White House Press Secretary Karoline Leavitt said Perez has been placed on paid administrative leave and that another operator will administer the teleprompter during Trump’s high-profile address on Thursday evening; Leavitt called the actions "a disgrace" and said the individual is complying with the CFTC.
Perez has worked for the president since 2016, and records show he was paid $175,000 a year as a deputy assistant to the president.
One source said Kalshi has banned Perez from betting on the site.
Sources said the CFTC has discussed terms of a settlement with Perez that could include him giving back profits from the trades.
In March, White House staff received a memo warning against using nonpublic government information to place bets on Kalshi and its competitor Polymarket, saying it is a criminal offense for anyone inside the White House to buy or sell on the sites and that misusing government information "is a very serious offence and will not be tolerated."
Utah Sen. John Curtis renewed his push to crack down on government officials using insider information to bet on prediction markets after the teleprompter operator reportedly made more than $100,000 betting on Trump speeches, and he linked to a bill that would ban the president, vice president, members of Congress, congressional staffers in both the House and Senate, members of the presidential Cabinet, political appointees and employees of executive agencies from placing such bets.
Curtis' proposal would fine anyone found in violation either $500 or an amount equal to double the profit made, whichever is greater.
The Senate approved an internal policy in May prohibiting senators and their staffers from using prediction markets, and the House is considering a similar policy.
There are several wagers listed on Kalshi about whether Trump will say the phrases "radical left," "election," or "Iran" at least three times, and more than $1 million has been wagered on those key phrases and others.
Bobby DeNault, identified as Kalshi's lead lawyer, said the investigation took "a few months" after the trading was first flagged and that accounts are typically frozen if they are flagged for suspicious trades.
Reporting earlier this year also highlighted a Polymarket trader who won $400,000 by predicting then-Venezuelan President Nicolás Maduro would soon be removed from office, with the outcome announced hours later.