Warren and Merkley press White House on prediction-market safeguards

Sens. Elizabeth Warren and Jeff Merkley have asked White House Counsel Will Scharf to explain what safeguards prevent presidential staff from using nonpublic government information to trade on prediction markets, after a former teleprompter operator was penalised for doing so.

In a Nov. 9 letter, the senators sought answers by Nov. 23 on whether other White House employees may have engaged in insider trading, what training and ethics agreements govern staff, how the Gabriel Perez case was investigated and what guidance has been issued to employees.

The letter concerned the Commodity Futures Trading Commission’s settlement with Perez, a former White House teleprompter operator. The agency found that, between December 2025 and February 2026, he used advance access to presidential speeches to trade contracts on words or phrases President Donald Trump would use.

Perez was ordered to disgorge $107,539 in trading profits and pay a $65,000 civil penalty, for a total of about $172,500. He also accepted a three-year trading ban and agreed to cease violating the Commodity Exchange Act and CFTC rules. The agency said the civil penalty was substantially discounted because of his exceptional cooperation.

The senators said Perez had typically carried out the final review of nearly all prepared presidential remarks and allegedly bet on more than a dozen speeches. Reports in July detailed the investigation, when Kalshi’s surveillance system flagged unusual trades, identified the account holder as a federal employee and referred the matter to the CFTC.

Perez was initially placed on unpaid leave after the allegations emerged and later left federal employment. Kalshi had already frozen about $90,000 of his profits and barred him from betting on the platform, according to NPR’s July report.

Warren and Merkley argued that the only publicly known White House response had been a March memo warning staff that buying or selling Kalshi or Polymarket contracts using nonpublic government information was criminal and would not be tolerated. They said prior administrations had responded to major ethics allegations with mandatory training, revised procedures and outside audits.

The letter also raised conflict-of-interest concerns over the Trump family’s connections to the industry. It noted that Donald Trump Jr. became a Polymarket adviser shortly before his venture-capital firm invested $300 million in the company; he also received a $300,000 equity stake in Kalshi in January 2025 and joined that platform as an adviser. Trump Media has announced plans for Truth Predict, a prediction market being developed with Crypto.com.