KBRA announced a companywide policy prohibiting employee participation in prediction markets and event contracts, citing the regulatory, compliance, and reputational risks associated with these rapidly evolving platforms. KBRA employees are prohibited from participating in prediction markets and event contracts, including platforms such as Kalshi and Polymarket, as well as any similar, successor, or functionally equivalent platforms.

Prediction markets, or platforms that allow users to trade on the outcomes of future events, have grown significantly in recent years, attracting increased interest from retail and institutional participants. However, their regulatory treatment remains in flux, and their structure raises complex questions around oversight, governance, and the potential use of nonpublic or market-sensitive information.

As a credit rating agency, KBRA is committed to maintaining the highest standards of independence, transparency, and integrity. While no organization can monitor or control every individual action, KBRA’s strong culture, Code of Conduct, and compliance framework guide employee behavior and decision-making. Given the nature of prediction markets and the potential for real or perceived conflicts, KBRA determined that a companywide prohibition is the only appropriate course consistent with its responsibilities to the market.

“Since KBRA’s founding over 15 years ago, we have remained focused on restoring trust in credit ratings, and we are taking a clear and proactive position on the risks associated with prediction markets and event contracts,” said Jim Nadler, CEO and President. “Our role in the financial system demands strong safeguards to protect independence and ensure the responsible use of information. We view this policy as a prudent and necessary step to address emerging risks and uphold the integrity of our work.”

This policy applies globally to all employees and is part of KBRA’s broader compliance-first approach and ongoing efforts to anticipate and address evolving risks across financial markets.

About KBRA

KBRA, one of the major credit rating agencies, is registered in the U.S., EU, and the UK. KBRA is recognized as a Qualified Rating Agency in Taiwan, and is also a Designated Rating Organization for structured finance ratings in Canada. As a full-service credit rating agency, investors can use KBRA ratings for regulatory capital purposes in multiple jurisdictions.

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