The U.S. Commodity Futures Trading Commission (CFTC) has settled charges against former White House employee Gabriel Perez, ordering him to return profits from trading prediction contracts based on non-public information and pay a fine. According to the order issued by the CFTC on August 28, 2026, Perez, while working as a teleprompter operator in the White House, used his access to the texts of President Trump's speeches to trade on the prediction market platform Kalshi.
How the Scheme Was Constructed
From December 2025 to March 2026, Perez held the position of Technical Advisor to the President and was part of the production team that directly operated the teleprompter during public addresses. This position gave him access to speech texts approximately one hour before their delivery.
On December 8, 2025, Perez opened an account on Kalshi and began trading "Trump word prediction" contracts—binary yes/no positions on whether the president would utter a specific word or phrase. The logic was simple: he bought "yes" if the word was present in the prepared text and "no" if it was absent. In one instance, Perez switched his position live during a speech upon noticing Trump deviating from the prepared text.
Profit and Settlement Terms
As stated in the CFTC's consent order (Docket No. 26-06), Perez traded on 14 markets related to Trump's mentions and closed 39 out of 43 contracts in profit, earning $107,539.02. He was personally present at all corresponding speeches. Perez voluntarily underwent an interview with the regulator, provided documents, and admitted to making trading decisions based on confidential data from the speech texts. For this cooperation, his civil monetary penalty was reduced by approximately 40%.
The final terms of the order are as follows:
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return all profits amounting to $107,539.02 within ten days;
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pay a civil monetary penalty of $65,000;
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cease violating the Commodity Exchange Act and CFTC regulations;
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comply with a three-year ban on trading on regulated markets.
The CFTC separately acknowledged the assistance of the KalshiEX exchange in investigating this case.
Kalshi's Response
On August 29, 2026, the exchange's head of enforcement, Robert J. DeNault, wrote on social media X that Kalshi's own investigation had identified the prohibited trading activity of a White House employee, and as a result of this case, the violator faced penalties from both the CFTC and the exchange itself. He stated that status or position does not exempt one from responsibility for violating the platform's rules or federal law.
The order itself does not state that the confiscated funds are automatically returned to the counterparties in these trades—they are recovered as part of the sanctions imposed by the regulator.
The case demonstrates that prediction market trading platforms, alongside traditional exchanges, are under the CFTC's oversight and are prepared to cooperate with the regulator in identifying suspicious activity by their own users. For the event contracts market, this is the first public case where official access to information about the actions of a head of state resulted in sanctions for trading.
AI Opinion
From a statistical standpoint, the Perez case fits into a broader trend. A similar scheme was already used on a competing platform: a Google employee was charged with insider trading on Polymarket, facing up to 50 years in prison, with the CFTC seeking to recover illicit gains and impose a ban on regulated markets. The U.S. Congress went further and initiated a review of both major platforms, requesting data on how they detect such abuses.
A risk remaining outside the article's scope is political proximity to power as a factor undermining trust in the prediction market institution itself. Similar suspicions have already arisen regarding Polymarket, where Donald Trump Jr. serves as an advisor to the platform, and a Yale School of Management professor directly called such a connection a threat to oversight independence. The question to keep in mind: will the regulator be able to respond equally harshly to violations if the next insider is closer to the head of state than a teleprompter operator?
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