Utah became the second U.S. state to file criminal charges against Kalshi and its co-founders.
- 13 felony and one misdemeanor charges filed against Kalshi executives Tarek Mansour and Luana Lopes Lara.
- The prediction market operator said it will fight the charges in court.
- This is the latest battle in a legal fight that began earlier this year between the two sides.
Thirteen felony charges and one misdemeanor were filed against Kalshi CEO Tarek Mansour and COO Luana Lopes Lara, according to a report from The Associated Press, for operating in a state with some of the strictest gambling laws in the U.S.
One of the felony charges was of second degree, with the others being third degree. The state didn’t specify what type of criminal penalties it will seek, but jail time is possible with those charges.
Criminal charges vs. Tarek Mansour: https://t.co/vm0t8xd7xx
— Daniel Wallach (@WALLACHLEGAL) October 28, 2026
Kalshi called the charges a “crazy overreach” and a political game. Kalshi executives faced similar charges in Arizona.
“We look forward to putting a stop to this in court, just like we did in Arizona,” the company said in a statement to the AP.
Taking the initiative
Utah Attorney General Derek Brown said Kalshi’s prediction markets are in clear violation of the state’s anti-gambling laws. There is no legal form of gaming in the Beehive State, and Utah officials believe Kalshi’s markets – such as spreads, moneylines, and totals on sports contracts – are gambling.
“Calling it a ‘prediction market’ doesn’t change what it is, and being federally registered doesn’t put a company above the law,” Brown said.
Utah has quickly become a major battleground between states and prediction markets. Kalshi sued the state in April after the prediction market operator was told to stop offering event contracts there.
However, a federal judge sided with Utah in August, saying that Kalshi’s federally regulated markets don’t preempt state law.
There are nearly 20 states currently involved in litigation with Kalshi, which continues to argue that only the CFTC, not states, can regulate its prediction markets that are “swaps,” not bets. The battle is expected to eventually be heard by the Supreme Court, however, such a resolution could still be many months away.
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Fighting back
Brown filed a lawsuit against Kalshi on Oct. 20, alleging that the trading exchange offering contracts on sports, politics, elections, and other markets violates the law and puts residents at risk.
“Kalshi runs an online casino in Utah and calls it a prediction market,” Brown said in a statement last week. “Not only do our state laws ban gambling, but Utah is one of only two states where gambling is also prohibited under the state constitution. For 130 years, Utah has been clear: gambling has no place here, and we will enforce our laws.”
On the same day that the state filed criminal charges, 37 states filed an amicus brief in the U.S. Court of Appeals, supporting Utah’s case against Kalshi, gaming attorney Daniel Wallach posted on X.
Talk about timing. Today, 37 states filed an amicus curiae brief backing Utah against Kalshi in the 10th Circuit. Notable omissions: Texas, Florida, Georgia, Indiana, New Hampshire, Pennsylvania, and Missouri, which just sent C&D letters to multiple prediction-market platforms. https://t.co/KrKOmsUds6
— Daniel Wallach (@WALLACHLEGAL) October 29, 2026
Ongoing litigation
The Commodity Futures Trading Commission, a government-appointed agency that regulates and registers prediction market operators, countered by suing Utah on Tuesday for attempting to block Kalshi from operating there.
“Event contracts do not just serve hedging and investment purposes – they also provide the public with information about the outcome of future events,” CFTC Chair Michael Selig said. “Congress entrusted the CFTC to be the federal regulator with sole responsibility to oversee these markets. As I’ve said before, the CFTC has the expertise and responsibility to defend its exclusive jurisdiction over commodity derivatives, and that’s exactly what we’ll do.”
