Two US senators have introduced the End Prediction Market Corruption Act in response to concerns that federal officials could profit from nonpublic government information through event-based trading.
The bill was introduced on Thursday by Jeff Merkley and Amy Klobuchar, with cosponsors Chris Van Hollen, Adam Schiff, and Kirsten Gillibrand. The proposal would prohibit the president, vice president, and members of Congress from buying or selling event contracts on prediction markets.
Under the measure, elected officials would face a full prohibition on event contract trading. Senior executive branch officials would face restrictions on trading contracts connected to matters related to their official duties. Violations could lead to a $10,000 fine, with enforcement handled through cases brought in federal court by the U.S. Attorney General.
The legislation defines a “senior executive branch official” as a non-elected government employee required to file financial disclosure reports covering income, assets, liabilities, financial transactions, and possible conflicts of interest.
That category includes civil servants paid at or above the top level of the federal pay scale, members of the military holding the rank of brigadier general or rear admiral and above, senior officials within the Postal Service and the Office of Government Ethics, administrative law judges, and White House staff commissioned by the president.
Unlike elected officials, these senior personnel would be prohibited from trading event contracts involving matters in which they participate directly and substantially in their government roles. The bill states that such participation could involve decision-making, approval or disapproval, recommendations, advice, investigations, or involvement in judicial or administrative proceedings, applications, contract matters, claims, controversies, charges, accusations, arrests, or other government matters.
The proposal also introduces disclosure requirements. Elected officials and senior executive branch personnel would need to state in their annual financial disclosure filings whether they, their spouses, or dependent children purchased, sold, or otherwise exchanged an event contract during the reporting period. If such activity occurred, the report would include a description of the contract and its value.
Merkley said the legislation seeks to address the risk of government officials using confidential information to gain a financial advantage through prediction markets.
“When public officials use non-public information to win a bet, you have the perfect recipe to undermine the public’s belief that government officials are working for the public good, not for their own personal profits,” Merkley said in a press release announcing the bill. “Perfectly timed bets on prediction markets have the unmistakable stench of corruption. To protect the public interest, Congress must step up and pass my End Prediction Market Corruption Act to crack down on this bad bet for democracy.”
Klobuchar pointed to recent reports involving controversial prediction market activity. In January, a user on Polymarket reportedly placed trades worth hundreds of thousands of dollars predicting that then Venezuelan president Nicolás Maduro would be removed from power less than 24 hours before he was captured by US forces.
Another trade occurred last week when a Polymarket user known as “Magamyman” reportedly earned $553,000 from a prediction linked to the death of Ali Khamenei shortly before he was killed in U.S.-Israeli strikes. The identities of the traders have not been disclosed.
“At the same time that prediction markets have seen huge growth, we have seen increasing reports of misconduct,” Klobuchar said in the press release. “This legislation strengthens the Commodity Futures Trading Commission’s ability to go after bad actors and provides rules of the road to prevent those with confidential government or policy information from exploiting their access for financial gain.”
In the House of Representatives, Ritchie Torres introduced a related proposal in January addressing prediction market trading by government officials. The House version would prohibit trading only when an official possesses, or could reasonably obtain through official duties, material nonpublic information.
The Senate proposal differs in scope. It would prohibit elected officials from trading event contracts regardless of access to nonpublic information.
The Senate bill also outlines penalties and enforcement procedures. The House proposal does not specify penalties or enforcement mechanisms.
Torres’s bill was referred eight weeks ago to the House Committee on Oversight and Government Reform and the Committee on House Administration. It has not advanced in either panel. The Senate proposal has not yet been assigned to a committee.
Original article: https://www.yogonet.com/international/news/2026/03/06/117921-us-senators-introduce-bill-banning-prediction-market-trading-by-federal-officials
