When President Donald Trump approached the podium to deliver his State of the Union address in February, one of the few people who knew what he was about to say was allegedly setting himself up to profit from the president’s words.
Trump’s longtime teleprompter operator, Gabriel Perez, is believed to have made tens of thousands of dollars by placing bets on that speech and more than a dozen others on the prediction market Kalshi, federal investigators with the Commodity Futures Trading Commission found, sources familiar with the matter told ABC News.
Perez, a technical assistant to the president who has been operating Trump’s teleprompter since 2016, is in talks with federal regulators to settle allegations he used his inside knowledge of the president’s speeches to win more than $100,000, the sources said.
How the Scheme Worked
According to sources, Kalshi alerted its regulator, the CFTC, to the suspicious activity on its “Mentions” market, where users can bet on whether specific words, phrases, or topics are uttered during a public speech.
“Our surveillance team promptly flagged and referred these trades to the CFTC, and we are cooperating and assisting regulators,” Kalshi’s lead lawyer said in a statement.
In addition to the State of the Union, sources said CFTC investigators discovered that Perez placed bets on more than a dozen Trump speeches over a three-month period, including a December primetime address, a January speech at the World Economic Forum in Davos, Switzerland, and Trump’s remarks in March during a Medal of Honor ceremony.
In certain instances, investigators uncovered times when Perez would back out of certain bets mid-speech when Trump skipped over a portion of the speech that included a word he had previously bet would be mentioned, the sources said.
The Investigation
According to sources familiar with the investigation, Perez sat for an interview with regulators in recent months and acknowledged some of the trades. At some point during the investigation, the sources said the CFTC alerted federal prosecutors in Manhattan, who declined to open a criminal investigation.
Regulators at the CFTC have expressed a willingness to settle with Perez, and have discussed terms with him that would require Perez to give back his profits and refrain from making similar trades, according to sources familiar with the ongoing discussions.
White House Response
“The White House has strict ethics guidelines that we expect all staffers and officials to follow,” said White House spokesperson Davis Ingle when contacted by ABC News. “The staffer in question is fully cooperating with the CFTC.”
Later in March, the White House issued an internal memo warning staff against using nonpublic information to place bets on prediction markets, sources previously confirmed to ABC News.
Prediction Market Context
Kalshi has a policy against users placing bets based on information obtained as part of their jobs. Last month, the company updated its policies to require users to disclose their place of employment.
The Department of Justice in recent months brought the first two cases of insider trading on prediction markets, involving a special forces soldier who allegedly bet on the capture of Venezuelan President Nicolás Maduro, and, separately, a Google employee who allegedly bet on user searches using internal company data. Both pleaded not guilty.
The Bottom Line
White House teleprompter operator Gabriel Perez is in settlement talks with federal regulators after allegedly making more than $100,000 betting on Trump’s speeches using inside knowledge. Perez had access to the president’s prepared remarks before they were delivered. The CFTC investigation found he placed bets on more than a dozen speeches over three months. Kalshi flagged the suspicious activity. The White House has since warned staff against using nonpublic information for betting.
