House Oversight Opens Formal Insider-Trading Probe Into Kalshi and Polymarket
Chairman James Comer sent document-demand letters to the CEOs of Kalshi and Polymarket on May 22, with a June 5 deadline, and signaled forthcoming legislation that would bar members of Congress, administration officials, and federal employees from trading prediction-market contracts.
House Oversight and Government Reform Committee Chairman James Comer (R-KY) announced on CNBC's Squawk Box on May 22, 2026 that he has sent formal document-demand letters to Kalshi CEO Tarek Mansour and Polymarket CEO Shayne Coplan. The letters request internal records on how each platform verifies the identities of domestic and foreign account holders, enforces geographic restrictions, and monitors trading for patterns consistent with insider information. Both CEOs were given until June 5 to respond. Comer framed the inquiry directly in his statement: "There's a concern now that members of Congress, members of the president's administration, any type of government employee, can use basic insider knowledge and make huge profits on anything government-related."
The probe rests on two pieces of public evidence the committee has cited explicitly. A recent New York Times investigation identified more than 80 Polymarket wallets that placed trades with timing patterns consistent with advance knowledge of major news events, including positions opened hours before US and Israeli strikes in Iran. Separately, the April 2026 arrest of US Army Master Sergeant Gannon Ken Van Dyke for trading roughly $400,000 in profits on Polymarket markets related to the Maduro operation gave the committee a documented criminal case to anchor the investigation. Comer told NOTUS that the current state of the market is "the Wild West."
Comer indicated that the probe is the first step toward legislation that would explicitly bar federal officials from trading event contracts. The proposed framework would parallel existing rules under the STOCK Act for individual securities, but applied to prediction-market contracts, which are currently treated as commodity derivatives and fall outside most government ethics disclosure regimes. New York Governor Kathy Hochul and Illinois Governor JB Pritzker issued state-level executive orders covering the same conduct in late April 2026; a federal statute would close the gap for the executive branch, legislative branch, and the federal contractor workforce, none of which are reached by state orders.
For Kalshi and Polymarket, the immediate question is whether the document production satisfies the committee or escalates to public hearings. Polymarket already cooperated extensively with the Department of Justice in the Van Dyke prosecution, and Kalshi has publicly highlighted its own compliance investments. Both companies have an incentive to produce thorough records on June 5; a perceived stonewall would hand Comer the political momentum to move legislation faster than the industry would like. The deeper risk is the legislation itself: a federal trading ban for government employees would not, on its own, materially shrink platform volume, but it would create a category of forbidden user that platforms have to actively police, exposing them to enforcement actions whenever the policing fails. That is a meaningful new compliance cost layered on top of the existing state-level patchwork.
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