Utah Charges Kalshi's Founders Over Sports Betting

The Utah Attorney General's Office has brought 14 charges against prediction market operator Kalshi and its founders, Tarek Mansour and Luana Lopes Lara. Thirteen of the charges are felonies. Prosecutors argue that the company broke state gambling laws by giving its users the ability to bet on sporting events.

According to the charging document, an agent of the Attorney General's Office opened an account on Kalshi using a Utah address, a local phone number and a government-issued bank card. After confirming the location, the agent placed 12 sports bets over roughly two weeks. The total amount wagered was $114.87, and the net loss was $25.10. The bets covered the NFL, college football, Major League Baseball, Major League Soccer and one NHL game. The agent correctly predicted six of the 12 outcomes.

Prosecutors say each bet is the basis for a charge of promoting online gambling, a third-degree felony under Utah law. The case also includes an allegation of a pattern of criminal activity and a misdemeanor charge of general gambling promotion. Mansour and Lopes Lara have reportedly been summoned to appear in the Third District Court in Salt Lake County.

Before the case was filed, Utah Attorney General Derek Brown had already filed a complaint against Kalshi in the same court, seeking damages of up to $61.2 million. Prosecutors claim that as of September 2024 the company was offering markets to Utah users, that it knew this was illegal, and that it collected commissions of between $30.6 million and $61.2 million.

The state is asking the court to stop Kalshi from offering event contracts to Utah residents in sports, politics, elections and culture, to require the platform to apply geographic access restrictions, and to order the recovery of profits obtained from illegal transactions. According to the filing, at least 32,000 state residents have used the platform.