A Google data safety engineer has been arrested and charged with commodities fraud, wire fraud, and cash laundering after allegedly utilizing confidential inner firm knowledge to position a sequence of bets on Polymarket — the crypto-based prediction market platform — profitable roughly $1.2 million by figuring out the outcomes of his wagers earlier than the buying and selling public did.
The US Lawyer’s Workplace for the Southern District of New York unsealed the criticism in opposition to Michele Spagnuolo, 36 — additionally recognized by his Polymarket account alias “AlphaRaccoon” — on Could 27, 2026. Spagnuolo, an Italian citizen residing in Switzerland, was arrested in New York and appeared earlier than US Justice of the Peace Decide Sarah Netburn, the place he was launched on a $2.25 million bond secured by $1 million in money, per the DOJ’s official assertion. He didn’t enter a plea.
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How The Scheme Labored
In line with the unsealed criticism, Spagnuolo had entry to an inner Google software program software — bearing a banner marked “Google Confidential” in crimson textual content — that supplied real-time visibility into what customers had been looking throughout Google’s platform, together with knowledge that fed instantly into Google’s annual “12 months in Search” rankings, per the DOJ submitting.
Starting in Could 2024, Spagnuolo created a Polymarket account and commenced putting bets on contracts tied to which people would rank on Google’s most-searched record for 2025 — markets Polymarket launched final fall, per the criticism.
Prosecutors allege Spagnuolo transferred roughly $3.8 million in USDC to his Polymarket deal with and positioned bets together with a $381.12 “sure” wager that the artist d4vd would rank in Google’s most-searched record and appropriately predicted contracts equivalent to “Will Zohran Mamdani rank within the High 5 most searched” and “Will Squid Recreation be the primary searched TV present,” per CNBC’s reporting of the criticism. His success fee throughout these markets was, in keeping with the criticism, no accident. He knew the solutions earlier than the markets settled.
The CFTC filed a simultaneous civil case in opposition to Spagnuolo searching for financial disgorgement, restitution, and extra penalties, per the criticism. Google confirmed it had positioned Spagnuolo on go away and was cooperating with legislation enforcement — noting that the software he used was technically accessible to all workers, however that utilizing confidential data to position bets represented a critical breach of firm coverage, per a press release reported by ABC Information.
The Second Case In Thirty Days
The Spagnuolo arrest is the second federal prison case tied to Polymarket insider buying and selling in simply over a month. In April 2026, US Military Particular Forces Grasp Sergeant Gannon Ken Van Dyke was arrested for allegedly utilizing categorised navy information of the deliberate seize of Venezuelan President Nicolás Maduro to position bets on Polymarket, reportedly netting greater than $400,000. Van Dyke has pleaded not responsible, per CNN’s reporting.
Polymarket’s chief authorized officer Olivia Chalos stated in a press release that the corporate labored intently with the US Lawyer’s Workplace and the CFTC on the Spagnuolo case — noting that Polymarket is the one prediction platform so far whose cooperation has led to insider buying and selling fees in the US, and that the blockchain-based nature of the platform means unhealthy actors go away footprints.
This growth marks a essential and accelerating second for the nascent prediction market sector. Two federal insider buying and selling arrests in thirty days — one involving navy categorised data, the opposite company search knowledge — arriving concurrently with an lively congressional investigation into Polymarket and Kalshi, confirms that the authorized perimeter round prediction markets is closing quick. The transparency of blockchain buying and selling, as soon as seen primarily as a characteristic for customers, is now functioning as a forensic path for federal prosecutors.
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