House Administration Chair Bryan Steil is pitching legislation that would bar lawmakers and their family members from wagering on certain Washington-focused prediction markets.
The Wisconsin Republican’s bill, introduced Thursday, proposes to prohibit members of Congress, their spouses and their dependent children from participating in prediction markets that are focused on specific government policy, government action or political outcomes. Violators would need to pay fines of at least $2,000 and the trade’s net gains, according to Steil’s office.
“The American people deserve to know their Member of Congress is not profiting off insider information,” Steil said. “Lawmakers should be writing policy, not wagering on its outcome.”
Steil’s bill lands in the middle of a firestorm over the risk of insider trading on the prediction markets — or financial exchanges that offer their users the chance to bet on U.S. elections, sports and the Oscars, among other events. The nascent industry has seen an explosion of growth amid a friendlier regulatory environment under President Donald Trump — but that attention has also brought new scrutiny, including from Congress.
Lawmakers’ concerns about insider trading on the prediction markets reached a fever pitch earlier this year after federal authorities charged a U.S. soldier with allegedly using confidential information to trade on the capture of then-Venezuelan leader Nicolás Maduro on Polymarket, a leading prediction market. The soldier has pleaded not guilty.
Just days after the charges were filed, the Senate unanimously voted to bar senators and their staffs from using the prediction markets altogether, effective immediately.
Federal regulators at the Commodity Futures Trading Commission, more recently, were investigating former Rep. George Santos for his trading activity on the prediction market Kalshi, a person familiar with the matter who was granted anonymity to speak freely told POLITICO earlier this month.
Santos said shortly after NPR first reported that the agency and the Justice Department were investigating, that his lawyers were in talks with authorities.
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