Don Davis Bill Would Fine Candidates $10K for Trading on Their Own Elections

Representative Don Davis introduced the No Betting on Your Own Race Act in the House on Monday, proposing to ban federal candidates and closely related parties from trading prediction-market contracts tied to their own elections. The prohibition would apply to candidates, their spouses, dependent children and authorized campaign committees, and would reach a broad set of contract types — not only outcome bets on who wins but contracts settling on whether someone remains a candidate, vote share, margin, or placement. Under the bill, violating the ban would be a civil offense punishable by a $10,000 fine per violation or three times any net financial gain from the trades, whichever amount is higher. The legislation also covers indirect exposure: inducing another person to take a position, holding a beneficial interest under any title, or knowingly funding someone else’s position would count as violations. The text devotes significant attention to exchanges and their compliance role. Platforms and their employees would be shielded from liability for acting in good faith to stop breaches — including restricting, suspending or closing accounts and canceling or unwinding positions — and could report suspected violations to the Commodity Futures Trading Commission, the attorney general or the Federal Election Commission without incurring liability or notifying the person reported. To enable screening, the bill directs the FEC to publish a free, machine-readable list of all federal candidates at least weekly, including each person’s name, commission identifier, office sought and dates in the race; state election boards and the FEC would also be required to notify filers about the rule. The prohibition would take effect on the date of enactment and covers a wider set of political-event contracts beyond individual races, capturing caucuses, nominations, control of Congress and any other events the CFTC designates by rule. The bill contains a limited de facto grace for positions that become covered only after a person declares candidacy: holding or selling such a position is not an offense during the minimum divestment window permitted by the platform. Exchanges have been policing these issues themselves so far — the reporting notes that Kalshi fined and suspended congressional candidates earlier this year and that the CFTC is probing trades tied to former Representative Adam Kinzinger — and agency staff have warned that named-individual contracts are vulnerable to manipulation.