preferred on
Points of Focus
- Laurie Buckhout bought contracts worth under $1,000 on herself.
- Kalshi imposed a three-year suspension and $2,589.96 financial penalty.
- Political insider trading concerns are intensifying across prediction markets nationwide.
Kalshi has suspended Republican congressional candidate Laurie Buckhout for three years after finding that she traded contracts tied to her own election campaign, extending a broader crackdown on political figures using prediction markets where they can directly influence the outcome.
Buckhout, a retired Army colonel running in North Carolina’s 1st Congressional District, purchased less than $1,000 of Kalshi contracts related to her candidacy, according to the company’s disciplinary notice.
Kalshi imposed a $2,589.96 financial penalty alongside the three-year ban. Buckhout cooperated with the investigation and accepted the settlement.
“I bet on myself. Literally,” Buckhout said, calling the trade a “dumb mistake” and saying she acted to resolve the issue after learning it violated the platform’s rules.
GOP House candidate in battleground district slapped with $2.5K fine, 3-year ban for 'dumb' Kalshi insider trades https://t.co/Hzl59RNwfJ pic.twitter.com/Vyh9dwhXny
— New York Post (@nypost) August 31, 2026
Candidates are considered direct decision-makers
Kalshi’s Rule 5.17(z) prohibits traders from entering markets where they are decision-makers or have any direct or indirect influence over the underlying event.
Because Buckhout is herself a candidate in the election contract, Kalshi concluded that she had direct influence over its outcome and therefore could not legally trade the market under exchange rules.
Buckhout is challenging Democratic Rep. Don Davis in a closely watched November rematch. Davis narrowly defeated her in 2024, while redistricting has since made the seat more favorable to Republicans.
The case raises a problem unique to political prediction markets. A candidate does not merely possess potentially valuable non-public information about polling, fundraising or campaign strategy; their own decisions can directly move the probability of the event being traded.
Kalshi spokeswoman Elisabeth Diana acknowledged that the exchange expects violations to occur as political markets grow, comparing enforcement to insider-trading surveillance in conventional financial markets.
Buckhout is not Kalshi’s first candidate crackdown
The action forms part of a much wider enforcement push.
Kalshi said in April that it had imposed five-year suspensions on three congressional candidates who traded markets connected to their own races.
On Aug. 31, it also issued three-year bans to former gubernatorial candidates Stephen Cloobeck, who ran in California, and Ben Midgley, who sought the Republican nomination in Maine. Both were accused of trading markets connected to their respective campaigns.
The toughest punishment went to former Republican Congressman George Santos, who became the first person permanently banned from Kalshi.
Kalshi concluded that Santos had reasonable cause to know information affecting contracts on whether he would attend President Donald Trump’s State of the Union address. He ultimately earned $17,839 when he did not attend and was fined $71,356 by Kalshi.
The CFTC had separately settled charges against Santos over the episode, requiring him to pay more than $35,000 and imposing a three-year trading ban.
Political insider trading is becoming harder to dismiss
The problem extends beyond candidates themselves.
The CFTC recently ordered former White House teleprompter operator Gabriel Perez to surrender more than $107,000 in profits and pay a $65,000 penalty after finding that he used advance knowledge of President Trump’s speeches to trade contracts on words and phrases the president would say.
Those cases put pressure on the argument that prediction markets should be treated exactly like ordinary financial exchanges.
Kalshi can prohibit insiders and punish traders after suspicious activity is identified. But political contracts create unusually broad categories of people with privileged information, including candidates, campaign employees, government officials and staff involved in events being traded.
Buckhout’s sub-$1,000 wager was small. The regulatory question it exposes is much larger: as election markets grow, platforms need to show they can identify politically connected traders before privileged information becomes another tradable advantage.
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