The U.S. Justice Department has charged Michele Spagnuolo, a software engineer at Google, with insider trading, asserting that he generated $1.2 million in profits by trading on Polymarket using confidential business information. Spagnuolo, who has been with Google for over a decade, allegedly operated under the pseudonym “AlphaRaccoon” on the prediction market platform.
United States Attorney for the Southern District of New York, Jay Clayton, expressed serious concerns over Spagnuolo’s actions, stating, “As alleged, Spagnuolo violated the duties he owed to his employer and used Google’s confidential business information to make more than $1.2 million in trading profits on Polymarket. Insider trading compromises the integrity of our markets.”
Prediction markets allow users to wager on various outcomes, but insider trading is illegal on these platforms. The Justice Department has recently pursued similar cases; one notable instance involved a U.S. Army soldier who reportedly leveraged insider knowledge of an operation to capture Venezuelan President Nicolás Maduro, which resulted in $400,000 in profits.
According to the complaint filed against Spagnuolo, he reportedly placed more than $2.7 million in wagers concerning Google’s “2025 Year in Search,” a marketing initiative revealing the most popular searches of the year. He allegedly accessed confidential internal data about search trends to inform his betting decisions.
A spokesperson from Polymarket emphasized collaboration with law enforcement agencies, asserting that they are the only prediction platform in the U.S. linked to insider trading charges. “Blockchain trading is transparent, traceable, and bad actors leave footprints,” the spokesperson noted. “We are committed to maintaining accurate, fair, and transparent markets as well as enforcing our rules and working with our regulators and law enforcement.”
In response to the situation, Google acknowledged the seriousness of the misconduct. A company spokesperson revealed, “The employee accessed our marketing material using a tool available to all employees, but using such confidential information to place bets is a serious breach of our policies.” Spagnuolo has been placed on leave while the company continues to cooperate with the investigation.
