Rep. James Comer Launches Insider Trading Probe Into Kalshi And Polymarket

Rep. James Comer, chair of the House Oversight and Government Reform Committee, launched an investigation into Kalshi and Polymarket over alleged insider trading, seeking internal documents from the CEOs of both platforms.

Comer’s probe, announced on May 22, targets trades tied to elections and geopolitical events, with responses due by June 5, and he asked for information on identity verification processes and procedures to flag suspicious trading activity.

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The investigation is framed around anomalous trading patterns tied to US military actions related to Venezuela and Iran, including a case in which a US Army soldier allegedly pocketed over $400,000 by leveraging classified information to place bets on events in Venezuela.

On CNBC’s “Squawk Box,” Comer said, “Internal records held by prediction market platforms are the only means by which bad actors can be identified,” and he added that the committee wants to “prove a case that we’ve got to pass some type of legislation.”

Kalshi and Polymarket responded to the probe by emphasizing their safeguards, with Kalshi’s head of communications Elisabeth Diana telling CNBC that the exchange is “proud of our comprehensive protections against insider trading.”

A Polymarket spokesperson told CBS News that the company “maintains a comprehensive market integrity framework,” while CBS News reported that Comer requested internal documents to determine what the companies are doing to deter insider trading.

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The scrutiny has also been tied to specific allegations involving military operations and political betting, including a “60 Minutes” report that Bubblemaps found 9 Polymarket accounts made a total of $2.4 million by correctly guessing the dates of pivotal moments in the conflict.

In a separate development, Decrypt reported that Kalshi unveiled Americans for Fair Markets (AFM) as a “well-capitalized” advocacy group, tapping Taylor Budowich as a strategic advisor, as House Oversight Chair James Comer launched insider trading investigations.

The House probe comes as other enforcement and legislative actions target prediction markets, including a criminal case in which the U.S. Army soldier Gannon Ken Van Dyke, 38, was charged with unlawful use of confidential government information for personal gain and pleaded not guilty.

CBS News reported that Van Dyke was charged in connection with bets tied to the Trump administration's capture of former Nicolás Maduro, and it also said the soldier “has been charged with unlawful use of confidential government information for personal gain.”

CoinDesk reported that Nicolas Vaiman, co-founder and CEO of Bubblemaps, warned that if irregular trades can be spotted, “so can enemies of the United States,” and it described his team finding 80 bets on Polymarket with a 98% win rate.

Beyond federal scrutiny, Decrypt said AFM’s website argues that “It would push them offshore—onto unregulated platforms with no identity verification,” as the House investigation seeks to determine whether platforms have adequate guardrails for domestic and international account holders.