Utah Files Criminal Charges Against Prediction Market Kalshi

The charges and the defendants

The attorney general's office of the western US state of Utah has filed criminal charges against the prediction market Kalshi, claiming the company engaged in illegal online gambling. As the complaint filed on Wednesday in Utah's Third Judicial District Court shows, KalshiEX LLC is charged under a pattern of unlawful activity, on 12 counts of promoting online gambling, and on one misdemeanor count of promoting gambling. Named as co-defendants in the case are CEO Tarek Mansour and COO Luana Lopes Lara. This was reported by AFP.

What the case is based on

The charges rest on an undercover operation: in September, a state employee opened an account on Kalshi under a fictitious name and placed 12 bets on professional and college sports. According to the complaint, the company required location confirmation before each bet, and the agent truthfully stated that he was in Utah. Prosecutors believe the commission on each bet constitutes income from illegal gambling. Gambling is fully banned in only two US states — Utah and Hawaii.

Background and the company's position

The criminal case followed a civil lawsuit filed on October 20 by Utah Attorney General Derek Brown, whose office estimated Kalshi's fees from state users at $30.6–61.2 million. Back in February, Kalshi itself sued Utah, seeking to block the application of gambling laws: in August a federal judge ruled against the company, and in September an appeals court declined to stay enforcement. According to the complaint, the company continued accepting bets in Utah after both rulings. Kalshi insists that its product is not gambling but something akin to market trading on yes-or-no questions. A company spokesperson called the charges a

Context: disputes across the country and an incident at Polymarket

Kalshi is being challenged by regulators in several states at once — through cease-and-desist orders and lawsuits over operating without a license. Federal appeals courts are divided in their assessments, and New Jersey has turned to the US Supreme Court to resolve the dispute. Meanwhile, Kalshi and its largest competitor Polymarket have struck partnerships with major news organizations and professional leagues, including the NHL and NBA, while outside the US such platforms remain illegal or unregulated in most countries. Separately, Polymarket announced on social media that it had temporarily halted trading on its international platform due to a compromise of one of its third-party vendors: according to the company, the problem has been fixed, the matter has been referred to law enforcement, and