Utah Escalates: Felony Charges Filed Against Kalshi Executives

Utah prosecutors filed criminal felony charges against prediction market operator Kalshi and two of its top executives on Wednesday. The move follows a federal court ruling earlier this year that allowed the state to enforce its gambling laws against the platform.

The charging documents name Kalshi, Chief Executive Officer Tarek Mansour, and Chief Operating Officer Luana Lopes Lara. The indictment includes 13 counts for violating the state’s prohibition on gambling and one additional count for profiting from illegal activity. While the attorney general’s office has not specified the exact penalties sought, felony charges carry the possibility of jail time.

Utah Attorney General Derek Brown stated that the company continued to operate in the state despite the federal ruling. “Gambling is illegal in Utah, whether you place the bet, run the game, or promote it,” Brown said in a statement. He added that being federally registered does not place a company above the law.

Kalshi responded by calling the charges a “crazy overreach.” The company said Utah is “clearly playing politics” and expressed confidence in stopping the case in court, similar to its success in Arizona.

The legal conflict began in February when Kalshi sued Utah in federal court to block the state from enforcing gambling restrictions. A federal judge denied that request, ruling that the Commodity Exchange Act does not prevent the state from applying its own laws. The 10th U.S. Circuit Court of Appeals in Denver declined to halt enforcement during Kalshi’s appeal last month.

Last week, Utah filed a separate civil suit in state court. That action seeks to stop Kalshi from trading on sports, elections, politics, and culture outcomes within the state. The state also asked the court to order the use of a specific geolocation provider to enforce the ban and to disgorge the profits made in Utah.

Legal analyst Daniel Wallach noted that Utah’s shift to felony charges differs from the civil actions used in other jurisdictions. He suggested the case could serve as a model for how other states approach Kalshi and Polymarket, particularly following a recent appellate victory for Nevada regulators. Litigation over prediction markets has spread across roughly 20 states, with the Commodity Futures Trading Commission suing at least 10 of them.

Arizona became the first state to file criminal charges against Kalshi earlier this year, though a judge placed that case on hold. The 9th U.S. Circuit Court of Appeals recently refused to allow Kalshi to restart trading in Nevada during that dispute. Utah’s new filing adds pressure to a fragmented legal environment that experts expect the U.S. Supreme Court may eventually settle.