The Japan Times - US betting firm sponsorships spark election integrity fears

Prediction market app Kalshi has asked at least two influencers paid to promote the site to delete X posts that spread baseless claims of "cheating" and "stealing" in the Los Angeles mayoral election, according to US media.

Another firm, Polymarket, told AFP "paid partnership" tags were removed from several other posts that similarly questioned the vote while promoting the company's betting odds.

The actions came as the unfounded posts raised alarm ahead of November's midterm elections –- in which President Donald Trump's Republican Party is seeking to maintain control of Congress -- followed by 2028's presidential race.

But an AFP review found more than half a dozen X posts casting doubt on California's results still carried the sponsorship tags on Friday, suggesting they continued benefiting from the paid partnerships with either firm.

"The LA mayoral race foreshadows what's to come in American election cycles," Jess Rauchberg, an assistant professor at Seton Hall University, told AFP.

"If 2016 was the 'social media election' and 2024 was the 'influencer election,' 2028 will be the 'prediction market election.'"

The sponsored posts added to a wave of misinformation about California's primary, largely from supporters of Trump, who has decried the mayoral race and other state contests as rigged.

Incumbent Democrat Karen Bass and progressive challenger Nithya Raman advanced to the mayoral runoff, topping Trump-hyped candidate Spencer Pratt in one of several closely watched primaries in the state.

- 'Profiting handsomely' -

In a statement to AFP, a Polymarket spokesman said company guidelines "explicitly prohibit affiliates from providing misleading or false information and we will continue to monitor and ensure compliance with our paid contributors."

He did not say how many sponsorship tags had been removed but AFP's review found at least four posts were affected.

Kalshi did not respond to AFP's requests for comment.

"Do these companies prohibit election denialism, or just messages that make them look bad?" Emerson Brooking, from the Atlantic Council's Digital Forensic Research Lab, told AFP.

"They are profiting handsomely from American democracy even as they weaken it."

AFP found paid partnership tags under posts from three individuals previously charged in relation to the January 6, 2021 insurrection that saw a violent mob attacking the US Capitol.

"California just keeps counting until the Democrat wins," one of them, Owen Shroyer, a former host of conspiracy website InfoWars, wrote in one post that has since been deleted.

The paid partners also include other creators AFP has previously fact-checked for spreading misinformation, such as right-wing YouTuber Nick Shirley.

In one post boosting Polymarket odds, American influencer Matt Wallace declared that "millions of illegals vote in California," referring to undocumented migrants.

Another post came from an anonymous account that admitted in 2024 to accepting payment for sharing content linked to a Russian disinformation campaign.

It suggested California's days-long ballot counting was cover for rigging: "Queue the mail in ballots!! Like clockwork."

- 'Explosion' of betting -

Prediction market firms, banned in some countries and facing scrutiny in the US over insider trading allegations, allow users to bet on the outcomes of events ranging from conflicts to sports, politics and elections.

Their paid partnerships spotlight what Brooking called the "perverse incentive structure" for influencers to profit from election misinformation.

"Influencers aren't paid to be right, they're paid to be seen," he said.

"When their predictions go the wrong way, the easiest thing for them to do is cry fraud."

AFP has fact-checked multiple falsehoods tied to California's elections, including unfounded claims of a fraudulent "ballot dump," a theory local authorities and a Trump-appointed prosecutor also debunked.

Brooking said that "the explosion of political betting markets makes things even worse" ahead of the midterms.

"Anyone with a big social media following has a potential profit-taking opportunity if they spread the right falsehood at the right time."

K.Tanaka--JT