The US state of Utah has announced criminal charges against popular prediction market Kalshi and its two cofounders, accusing the platform and its executives of illegally promoting online gambling.
Utah Attorney General Derek Brown filed the charges against Kalshi, chief executive officer Tarek Mansour and chief operating officer Luana Lopes Lara on Wednesday, a day after US President Donald Trump’s administration sued the state to block its civil enforcement actions against the platform.
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According to the criminal complaint filed in a Salt Lake City court, Kalshi facilitated an undercover law enforcement officer’s wagers on sports events, including games in the NFL.
The charges come after a federal judge in August ruled that Utah was entitled to enforce its stringent anti-gambling laws against online prediction markets, following a legal bid by Kalshi to block enforcement of the law.
The criminal complaint accuses the defendants of 12 counts of online gambling promotion, one count of general gambling promotion and one count of pattern of unlawful activity.
Kalshi and Brown’s office did not immediately respond to requests for comment.
Utah has some of the strictest prohibitions against gambling in the US, with its state constitution explicitly barring lawmakers from legalising the activity.
The charges mark an escalation in a showdown between US states and the Trump administration over the regulation of prediction markets.
On Tuesday, the Commodity Futures Trading Commission filed a lawsuit seeking to block Utah’s enforcement actions against prediction markets, arguing that the platforms fall under federal jurisdiction.
The regulator announced the move after Utah last week filed a civil lawsuit accusing Kalshi of facilitating betting on sports, elections, politics and other outcomes in violation of anti-gambling laws.
Dozens of US states, led by both Republican and Democratic administrations, have argued that the Commodity Futures Trading Commission does not have the authority to regulate prediction markets.
Last month, the state of New Jersey asked the US Supreme Court to rule on whether state or federal authorities have jurisdiction over sports betting on prediction market platforms.

Alphabet and Microsoft reported surging demand for artificial intelligence in their quarterly earnings Wednesday, and the technology giants continue pouring billions of dollars into the infrastructure needed to support the growing industry.
Google parent Alphabet expects capital expenditures to increase significantly in 2027 after projecting between $195 billion and $205 billion in spending this year, underscoring the enormous costs associated with expanding AI infrastructure.
Alphabet reported third-quarter revenue of $127.6 billion, up 25% from a year earlier, while Microsoft posted fiscal first-quarter revenue of $92.3 billion, an increase of 19%.
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Google Cloud revenue more than doubled to $30.7 billion, a 103% increase from the previous year, while Microsoft’s Azure cloud business reported revenue growth of 48%.
“Our AI infrastructure and solutions are the major drivers for Cloud growth, and our customers see us as the leading provider here, so there’s huge demand,” Alphabet CEO Sundar Pichai said during the company’s earnings call.
“We are working hard to bring more capacity online to meet this long-term demand.”
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Alphabet spent approximately $51.4 billion on capital expenditures during the third quarter, more than double the amount spent a year earlier, with much of the investment directed toward technical infrastructure supporting its AI and cloud businesses.
Chief Financial Officer Anat Ashkenazi also warned that Google Cloud could face near-term margin pressure as the company relies on third-party computing capacity to meet demand.
Microsoft similarly highlighted strong demand for AI services, with Microsoft Cloud revenue rising 30% to $63.9 billion.
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The company’s commercial remaining performance obligation, a measure of contracted future revenue across its commercial businesses that has not yet been recognized, climbed 73% to $677 billion.
The results underscore the challenge facing both companies as they seek to capitalize on growing AI demand while managing the substantial costs of building the infrastructure needed to support it.

Shares of Alphabet were falling hard in after-hours trading as the company reported a third-quarter revenue and earnings miss on Wednesday, stoking fears that artificial intelligence is pressuring its core search-engine business.
Overall revenue for Alphabet GOOGL GOOG grew 25% from a year before to $127.6 billion, missing the $128.0 billion figure expected by analysts. Earnings per share of $2.12 were also lower than Wall Street consensus estimates of $3.02, driven by a $8.6 billion paper loss on equity stakes which the company attributed to its investment in SpaceX SPCX.

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Unproven but popular peptides touted for wellness have been available on the gray market, despite an official ban. Now, the Department of Health and Human Services is looking to bring them out of the shadows.
HHS said in a new policy that it will exercise enforcement discretion for a half dozen peptides, essentially looking the other way when they’re made by small compounding pharmacies.
Health Secretary Robert F. Kennedy Jr. has been a vocal supporter of peptides, saying he has used some of them himself.
Peptides are strings of amino acids, shorter than proteins, that can exert powerful effects in the body. Some occur naturally and others are synthetic variations. Wellness influencers and some clinicians have promoted unproven peptides for a wide range of uses, though the evidence for their safety and effectiveness is sparse.
So even though these peptides have not been through the Food and Drug Administration’s rigorous drug review and approval process, they could become easier to get. But the policy’s focus on smaller producers may mean that pharmacists will have a tough time meeting demand.
In July, a panel of advisers to the FDA voted in favor of expanded access to six peptides through compounding pharmacies. However, at the same meeting the FDA’s own scientists recommended against unwinding the existing restrictions on them.
The new policy says compounding is a safer alternative to illicit “research-use-only” peptides that are available online. They’re often sourced from sketchy suppliers overseas.
The peptides, and some of their unproven uses, are:
BPC-157, ulcerative colitis
Epitalon, insomnia
KPV, wound healing
MOTS-c, metabolic health
Semax, migraine
TB-500, wound healing
Joshua Fritzler, the president of Olympia and Wesley Pharmaceuticals in central Florida, says people have been asking about these peptides for years. But because they were illegal to compound, his company didn’t make them.
The new policy doesn’t change their legal status, but it does create a path for small compounders, called 503A compounding pharmacies. It doesn’t apply to the larger ones, called 503Bs, that are outsourcing facilities producing higher volumes of medicines.
So at Fritzler’s company, only its smaller compounding facility will be able to make the peptides – and only in small quantities, he says.
And that has implications for consumers.
“We won’t be able to meet demand,” he says, explaining that Olympia will likely only compound one of the six peptides and needs to get its facility ready first. “I don’t think all the [503]As in the country could meet the demand.”
The Alliance for Pharmacy Compounding’s CEO Scott Brunner wrote in a statement that his group is pleased with the administration’s decision to allow the peptides to be compounded because it offers a “more accountable alternative” for patients seeking gray market peptides.
“It also brings patients into a system where pharmacy standards, regulatory oversight, and serious adverse event reporting apply,” he says.
Brunner warned, however, that it may take some time for compounding pharmacies to begin dispensing these products to patients. That’s because ingredient suppliers need to make sure their active ingredients meet the policy’s requirements — and pharmacies need to verify that, too.
Several consumer advocacy groups say the policy puts patients at risk, however. The nonprofit Public Citizen noted that Kennedy seems to have acted unilaterally rather than through the typical rulemaking process.
“By allowing unproven and potentially unsafe peptides to be manufactured, marketed and prescribed without concern about potential federal enforcement actions, Kennedy has undermined the FDA and threatened public health,” Dr. Robert Steinbrook, Health Research Group Director at Public Citizen wrote in a statement. “All peptide substances should go through the standard FDA approval process for new drugs. The HHS Secretary should support, not sabotage, needed FDA enforcement actions to protect consumers.”
Steinbrook advised clinicians to talk to their patients and tell them about the risk of contamination and other adverse effects.
The Partnership for Safe Medicines, which includes various pharmacy and pharmacist organizations around the country, filed a citizen petition last week, urging the FDA to ignore the recommendation from its advisory committee in July to allow compounding pharmacies to make the six peptides.
“Today’s decision leaves Americans in a grey area as to whether peptides are safe or not, even though the FDA’s own scientists recommended against voting in favor of these substances due to concerns with evidence,” its executive director Shabbir Safda wrote in a statement.