Utah Hits Kalshi and Co-Founders with 13 Felony Charges
Just days after the federal government sued Utah to halt its civil case against prediction market platform Kalshi, Utah Attorney General Derek Brown escalated the state’s legal battle by hitting the website and its co-founders, Tarek Mansour and Luana Lopes Lara, with criminal charges.
Thirteen felony charges and one misdemeanor were leveled against Kalshi. The filing includes one count of a pattern of unlawful criminal activity as a second-degree felony, 12 counts of online gambling promotion, and one count of general gambling promotion as a Class A misdemeanor. Both Mansour and Lopes Lara could face prison time if convicted.
“A federal court has already ruled that Utah’s gambling laws apply to Kalshi,” Brown said in a public statement. “Kalshi kept taking bets from Utahns anyway. That is illegal, and we’re putting a stop to it.”
The Timeline of the Investigation
The timing of the Utah Attorney General’s criminal case coincided with a lawsuit filed by the Commodity Futures Trading Commission against Utah, though the state’s charges followed a months-long investigation. The federal derivatives market regulator maintains that Kalshi operates as a CFTC-registered contract market and sits above state law.
Back in September, Attorney General’s Office investigator Scott Eggerman used a Utah-based IP address to create a Kalshi account and place a series of wagers on sporting events. Eggerman found he was able to place those bets despite an Aug. 4 federal court ruling against the site. Kalshi sought an injunction while appealing that decision, but the court denied it.
Prediction markets like Kalshi occupy a gray area by offering yes-or-no event contracts on outcomes ranging from sports and elections to whether rapper Nicki Minaj will become the next White House press secretary. Utah officials argue those offerings are indistinguishable from the bets offered by a traditional sportsbook.
Political Ties and Broader State Actions
Prediction markets have notable political connections. Donald Trump Jr. serves as a strategic adviser to Kalshi, and President Donald Trump launched a cryptocurrency-based prediction market app through Truth Social called Truth Predict.
Utah officials previously hinted at pursuing criminal charges. In May, Gov. Spencer Cox praised Arizona for pressing charges against Kalshi. When asked at the time about potential repercussions from the federal administration if Utah moved against prediction market apps, Cox stated he felt no concern.
“We haven’t heard anything from the administration,” Cox said in May. “You know, I came out very strongly. It’s been several weeks ago now, and there’s been no, no pushback at all on that piece.”
A federal judge initially blocked Arizona’s case, but following a 9th U.S. Circuit Court of Appeals ruling favorable to Nevada, Arizona began looking to revive its prosecution.
Kalshi’s Response
In a formal statement, Kalshi dismissed the Utah Attorney General’s prosecution as a severe overreach. “Utah is clearly playing politics,” the company said. “We look forward to putting a stop to this in court, just like we did in Arizona.”
