Utah Charges Kalshi Co-Founders With Felonies Over Betting Operations

Utah prosecutors filed criminal charges against prediction market Kalshi and its two leaders on Wednesday.

The state brought 13 counts for violating its gambling ban. It added one count for profiting from that illegal activity. These are felony offenses. The documents name the company, CEO Tarek Mansour, and COO Luana Lara. The charges follow a federal judge's earlier decision that allowed Utah to enforce its laws on the platform.

Attorney General Derek Brown said Kalshi continued operating despite the court ruling. He stated that gambling is illegal in Utah whether you place the bet, run the game, or promote it. Brown added that the term prediction market does not change the nature of the product. He also noted that federal registration does not exempt a company from state law.

Kalshi called the move a crazy overreach in a written response. The company said Utah is clearly playing politics. It said it looks forward to ending the matter in court, similar to its experience in Arizona. The attorney general's office did not immediately specify which criminal penalties it would seek. However, felony charges carry the possibility of jail time.

This legal battle is part of a wider fight over who regulates these markets. Litigation has spread across roughly 20 states. The fragmented legal situation may lead to a Supreme Court decision. Kalshi has argued that prediction markets fall exclusively under federal jurisdiction. The state believes its anti-gambling laws apply to the company's activity.