Utah brings criminal charges against KalshiEX and names its co-founders as co-defendants, two days after the CFTC sued the state

The Utah Attorney General’s Office has published a criminal information, State of Utah v. KalshiEX, LLC, captioned in the Third Judicial District Court, Salt Lake Department, Salt Lake County. The document is dated 28 October 2026 and was “authorized for presentment and filing” on that date by Criminal Deputy Attorney General Stewart M. Young, on behalf of Attorney General Derek Brown. The case-number fields in the published copy are blank.

All of the charges described below are allegations made by the state. No court has made any finding on them, and the defendants are presumed innocent unless proven guilty.

The charges

KalshiEX, LLC is named as the defendant. Tarek Mansour and Luana Lopes Lara are listed as co-defendants under the heading “Co-Defendant Information (Summons)”. The information describes Mr Mansour as Kalshi’s co-founder and chief executive, and Ms Lopes Lara as its co-founder and chief operating officer.

The information lists 14 counts:

• Count 1: pattern of unlawful activity, a second-degree felony, under Utah Code §76-17-407, with corporate criminal liability pleaded under §76-2-204.
• Counts 2 to 13: online gambling promotion, a third-degree felony, under Utah Code §76-9-1404, again with §76-2-204. There are 12 such counts.
• Count 14: general gambling promotion, a class A misdemeanour, under Utah Code §76-9-1405(2) and (3)(a).

The published copy contains apparent typographical errors in some statutory references. Counts 2 to 13, for example, cite “765-2-204” [sic], and the supporting text of Count 1 cites ”§ 76-98-1404” [sic]. Based on the surrounding text, this article gives these as §76-2-204 and §76-9-1404.

The text of each count charges “the defendant, KALSHIEX, LLC, either directly or as a party”. Each count also alleges that the conduct was “authorized, solicited, requested, commanded, or undertaken, performed, or recklessly tolerated” by KalshiEX’s board of directors or high managerial agents. The count text does not name the co-founders.

The co-founders appear in the attached declaration of probable cause. It alleges that each of them, as co-founder and as chief executive or chief operating officer respectively, “acquired or maintained … an interest in or control of an enterprise, Kalshi” and “conducted or participated … in the conduct of the enterprise’s affairs through a pattern of unlawful activity”. The published document does not set out separate counts against either co-founder.

The alleged basis

According to the declaration, a special agent of the Attorney General’s Office opened an undercover Kalshi account on 13 September 2026, using an undercover persona with a Utah address, phone number and bank account. The state alleges that between 13 and 24 September 2026 the agent placed 12 wagers through the platform while in Salt Lake County or Davis County, after confirming his location in Utah. It alleges that Kalshi charged a fee on each wager and used those proceeds in the operation of its business.

The 12 online gambling promotion counts correspond to those 12 alleged episodes, which together form the alleged pattern in Count 1. Counts 1 and 14 cover the period from 13 to 26 September 2026. The declaration also alleges that Kalshi uses part of its revenue to pay market makers through incentive programmes.

The information relies on an earlier federal ruling. It says that on 4 August 2026 Judge Robert J. Shelby of the US District Court for the District of Utah concluded that the Commodity Exchange Act does not preempt Utah’s enforcement of its gambling laws against Kalshi. That ruling came in Kalshi’s own suit against Governor Spencer J. Cox and others (Case 2:26-cv-00151). The information also says the Tenth Circuit denied Kalshi an injunction pending appeal on 8 September 2026. It alleges that Kalshi and its co-founders “have continued to provide or offer to provide online gambling to individuals in the State of Utah” since then. The Attorney General’s Office described the same rulings in its 20 October release, which said the appeal “remains pending”.

How the dispute escalated

20 October 2026: Utah’s civil case. The Attorney General announced a civil lawsuit in state court against KalshiEX LLC and related entities. His office said the complaint alleges that Kalshi’s offering in Utah violates the state’s gambling laws and is a public nuisance, and asks the court “to stop Kalshi from offering these bets in Utah”. “Kalshi runs an online casino in Utah and calls it a prediction market. That violates Utah law,” Mr Brown said in the release. The federal complaint identifies the case as Brown v. Kalshi Inc., et al., No. 260908356, in the Third Judicial District Court for Salt Lake County.

26 October 2026: the federal suit. The United States and the CFTC sued the State of Utah and Mr Brown, in his official capacity, in the US District Court for the District of Utah (Case 2:26-cv-01055). They ask for:

• a declaration that Utah’s laws are preempted “as applied to transactions listed, offered, or executed on CFTC-regulated DCMs”; and
• a preliminary and permanent injunction barring the defendants “from investigating CFTC-regulated entities and their affiliates and partners for violations of, or enforcing, Utah state laws” as applied to those transactions.

The complaint says the state’s pending case against Kalshi, “as well as any future enforcement actions or investigations against federally regulated DCMs and related entities, must be enjoined immediately”. It describes KalshiEX LLC, a non-party to the federal suit, as approved by the Commission as a designated contract market.

The CFTC announced the suit on 27 October 2026 in Release 9315-26. Chairman Michael S. Selig said: “Congress entrusted the CFTC to be the federal regulator with sole responsibility to oversee these markets.” The release says the Commission “has also initiated legal proceedings against nine other states”.

28 October 2026: the criminal information. The information is dated two days after the federal complaint was filed and one day after the CFTC’s announcement. It does not refer to the federal suit. The same day, according to the court docket, the federal case was reassigned to Judge Shelby.

The Midpoint reported the federal suit on 28 October 2026: United States and CFTC sue Utah seeking to halt its gambling case against Kalshi.

What comes next

As of 21:20 GMT on 29 October 2026:

• Utah. The Attorney General’s website listed no news release on the criminal charges. Its most recent release on Kalshi was the 20 October 2026 announcement of the civil case. The Utah Department of Commerce news page, which carries Division of Consumer Protection releases, listed none on Kalshi.
• Kalshi. Kalshi had not published a response on its news site or its official X account.
• Federal docket. The RECAP copy of the docket in Case 2:26-cv-01055, last updated on 29 October 2026, showed the complaint, a notice of related action, the summonses and the reassignment. It showed no motion for a temporary restraining order or preliminary injunction. RECAP copies may not be complete.
• Criminal proceedings. The published information gives no case number or court dates.

What we are watching

• Whether the information is formally filed and assigned a case number, and the dates of any first appearance.
• Any response from KalshiEX or the co-founders.
• Whether the United States and the CFTC seek interim relief in Case 2:26-cv-01055 that would reach the criminal case.