Reported by 2 sources

The short version

  • Gabriel Perez was fined for using nonpublic information about presidential speeches to place bets on the Kalshi platform between December and February.
  • The settlement includes a three-year trading ban and requires Perez to disgorge over $107,000 in illicit gains, with penalties reduced due to his cooperation.
  • The case highlights growing regulatory scrutiny of prediction markets as platforms like Kalshi cooperate with federal agencies to identify suspicious activity.

Federal regulators have imposed a financial penalty on a former White House employee who used privileged access to presidential speech drafts to place wagers on an online prediction market. The Commodity Futures Trading Commission announced that Gabriel Perez, who served as a teleprompter operator, must pay a total of $172,000. This amount comprises a civil penalty of $65,000 and the disgorgement of approximately $107,539 in profits he earned from his unlawful trading activities.

The enforcement action stems from trades Perez made on the Kalshi platform between December 2025 and February 2026. During this period, Perez held a position that granted him early access to the text of speeches delivered by President Donald Trump. Regulators determined that Perez misappropriated this material, nonpublic information to bet on whether specific words or phrases would appear in those addresses. By leveraging his insider knowledge, he breached the duty of trust and confidence owed to his employer and violated federal laws prohibiting market manipulation.

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The CFTC noted that the financial penalties were significantly reduced because Perez provided exemplary cooperation during the investigation. In addition to the monetary sanctions, Perez agreed to cease and desist from further violations of federal securities laws. He has also been barred from participating in trading activities for a period of three years. The agency’s decision marks one of the most prominent examples of insider trading enforcement related to the emerging sector of digital prediction markets.

Perez’s departure from the White House occurred amid an internal investigation into his betting activities. At the time, he was placed on unpaid leave and subsequently left his post. It remains unclear whether he resigned voluntarily or was terminated by administration officials. Karoline Leavitt, who served as press secretary during the initial reports of the misconduct, described the alleged insider trading as a disgrace. The White House has not issued new comments regarding the final settlement.

The case underscores the increasing intersection between government operations and speculative financial platforms. Kalshi, the platform where Perez placed his bets, played an active role in identifying the suspicious activity. Company analysts detected unusual patterns in contracts related to presidential speech content as early as March. Upon discovering that the account belonged to a federal employee with access to sensitive information, Kalshi reported the behavior to the CFTC. The regulator publicly thanked the company for its assistance in resolving the matter.

This incident is part of a broader trend involving prediction markets and potential conflicts of interest. Similar cases have emerged recently, including the indictment of a U.S. soldier accused of betting on political outcomes in Venezuela using inside knowledge from military operations. Additionally, Kalshi has previously fined political candidates who wagered on their own election prospects. These developments suggest that regulators are actively monitoring how nonpublic information flows into these markets.

The White House Management Office responded to the growing concerns by issuing guidance to staff members. In July, officials sent a letter instructing aides against placing bets on prediction markets. This directive came as administration leaders sought to distance themselves from the ethical implications of employees engaging in speculative trading based on their government roles. Perez’s annual salary for his teleprompter duties was reported to be $175,000, highlighting the significant access and responsibility associated with even support positions within the executive branch.

President Trump has historically defended the prediction market industry, which has ties to his family’s business interests. He has argued against state-level regulation of these platforms, suggesting instead that federal oversight by agencies like the CFTC is more appropriate. The Perez case illustrates the complexities of this regulatory landscape, where federal enforcement must balance innovation in financial technology with the need to prevent abuse of privileged information. As prediction markets continue to proliferate, questions about transparency and accountability are likely to remain at the forefront of policy debates.

The settlement does not resolve all uncertainties surrounding the scope of insider trading in digital markets. While Perez has been penalized, it is unclear how many other individuals may have engaged in similar conduct without detection. The CFTC’s willingness to pursue such cases signals a heightened focus on maintaining market integrity. For now, the case serves as a cautionary tale for government employees and traders alike, emphasizing that access to nonpublic information carries strict legal responsibilities.

Looking ahead, the implications of this ruling may influence how prediction markets operate and are regulated. Platforms like Kalshi may face increased pressure to implement stricter monitoring systems to detect insider trading before it occurs. Meanwhile, federal agencies will likely continue to scrutinize the intersection of government employment and speculative finance. The Perez case sets a precedent that could shape future enforcement actions and policy discussions regarding the role of prediction markets in American political life.

Sources behind this briefing

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