James Comer, who leads the House Oversight Committee, has started an investigation into the prediction platforms Kalshi and Polymarket. He is looking into possible insider trading related to world events and elections.
Comer has asked both companies to explain how they check user identities, set location restrictions, and spot suspicious trades by June 5. He worries that government workers might be using private information to profit from these online markets.
LATEST: 🇺🇸 House Oversight Committee Chair James Comer has opened an insider trading probe into Kalshi and Polymarket, asking both CEOs to hand over records on identity checks and suspicious trade detection by June 5. pic.twitter.com/DPfGTFRKWR
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Regulators are focusing on questionable bets related to world events
The investigation began after Representative Chris Pappas and other lawmakers requested a formal review. The issue gained more attention when the New York Times reported that more than 80 Polymarket users made bets just hours before secret U.S. and Israeli military actions against Iran. These timely bets resulted in large profits.
Comer has also sent formal letters to the CEOs of Polymarket and Kalshi, asking for their internal transaction records. The committee wants to check how these platforms follow federal rules. Lawmakers believe that reviewing the platforms’ own data is the only way to find people who use secret information to profit.
Event contracts are facing increased scrutiny
This investigation is happening as enforcement in the industry is building up. In April 2026, federal officials charged U.S. Army soldier Gannon Ken Van Dyke with commodities fraud and wire fraud. He is accused of using secret military information to make over $400,000 by betting on Polymarket about the capture of Venezuelan leader Nicolás Maduro.
“Prediction markets are not a haven for using misappropriated confidential or classified information for personal gain,” said U.S. Attorney Jay Clayton for the Southern District of New York.
The scrutiny facing Kalshi and Polymarket is not new. U.S. lawmakers are currently investigating whether these prediction market platforms facilitate insider trading related to significant events and elections. Polymarket cooperated with federal authorities, but there are still gaps in following the rules. Meanwhile, Kalshi is facing state-level challenges, even though it recently won some federal court cases.
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