Utah Files 14 Criminal Gambling Charges Against Kalshi and Its Co-Founders

Utah has filed 14 criminal charges against prediction-market operator KalshiEX LLC and its two co-founders, accusing them of promoting illegal online gambling.

Utah Attorney General Derek Brown filed the charges in the state’s Third District Court in Salt Lake County on October 28, naming CEO Tarek Mansour and COO Luana Lopes Lara alongside the company. The filing lists one second-degree felony count of engaging in a pattern of unlawful activity, 12 third-degree felony counts of online gambling promotion and one misdemeanor gambling promotion count, according to the charging document.

The case rests on an undercover operation. Prosecutors say state Special Agent Scott Eggerman opened a Kalshi account using a Utah residential address, a local phone number and a locally issued debit card, passed a location-services check, and then placed 12 sports wagers totaling $114.87 between September 13 and September 26, losing $25.10 net. The wagers covered NFL, college football, baseball, soccer and hockey matches, and prosecutors say each wager produced one felony count.

Brown said the federal registration of the exchange makes no difference under state law. “Gambling is illegal in Utah, whether you place the bet, run the game, or promote it. Calling it a ‘prediction market’ doesn’t change what it is, and being federally registered doesn’t put a company above the law,” he said in a statement.

Kalshi, which has argued its event contracts are federally regulated derivatives and not gambling, pushed back sharply. A company spokesperson called the prosecution “a crazy overreach” and said Utah is “clearly playing politics,” adding that the company expects to defeat the charges in court as it did in Arizona. Mansour and Lopes Lara received court summonses rather than arrest warrants.

The criminal filing escalates a fight that has moved fast. Utah sued Kalshi and two Susquehanna trading firms civilly on October 20, seeking roughly $30 million to $61 million in trading fees it says the platform collected from Utah users. The state had already won in district court: on August 4, Judge Robert Shelby ruled that federal commodities law does not prevent Utah from enforcing its gambling statutes against the exchange, and the Tenth Circuit denied Kalshi emergency protection pending appeal on September 8. Kalshi remains off limits in several states as the dispute widens.

The day before the charges, the CFTC under Chair Michael Selig sued Utah to block state enforcement against federally regulated prediction markets, its 10th such suit against a state. On October 29, a coalition of 37 state attorneys general filed a brief backing Utah’s regulatory authority in the pending federal appeal.

Kalshi’s response to the US Supreme Court on New Jersey’s petition in the wider dispute is due November 9. The penalties Utah will seek have not been specified.