Feds Charge Google Engineer in $1.2 Million Polymarket Insider Trading Scheme
Posted on: May 28, 2026, 06:55h.
Last updated on: May 28, 2026, 08:03h.
- An employee at Google is accused of trading on a prediction market with insider information
- The Polymarket user, who is facing federal charges, allegedly made $1.2 million in illicit profits
- If found guilty, the defendant faces up to 50 years in prison
A software engineer at Google is facing federal charges for allegedly using undisclosed information to make $1.2 million on the prediction market Polymarket.
The United States Attorney’s Office for the Southern District of New York alleges that Michele Spagnuolo committed commodities fraud, wire fraud, and money laundering by misappropriating confidential information from his employer. The federal complaint alleges Spagnuolo used the intelligence to make a series of Google-related trades on Polymarket.
Today’s charges reinforce a decades-old message: corporate insiders cannot use confidential business information to turn a profit in our markets. As alleged, Spagnuolo violated the duties he owed to his employer,” said U.S. Attorney Jay Clayton.
Spagnuolo, an Italian-born citizen residing in Switzerland, is charged with violating the Commodity Exchange Act, one count of wire fraud, and one count of money laundering. The charges carry a combined possible imprisonment of 50 years.
Google Prediction Market Contracts
Federal prosecutors allege that Spagnuolo violated Google’s confidentiality and ethics policies by accessing internal information regarding who would be Google’s most searched person in 2025. Knowing who would be #1, Spagnuolo allegedly began placing large bets on Polymarket beginning around Oct. 15, 2025, and running through Dec. 4, 2025.
The federal complaint contends Spagnuolo traded under the Polymarket account, AlphaRaccoon. Prosecutors believe Spagnuolo rolled over his winnings into new bets, cashing out contracts and making new, larger trades. In total, his Polymarket crypto wallet facilitated $2,754,092 in trades related to Google Search outcomes.
AlphaRaccoon traded $937,688 on the “NO” side of Bianca Censora being the most-searched person, $613,587 on the “NO” side of Pope Leo XIV, and $509,149 on the “NO” side of President Donald Trump. Spagnuolo is also accused of buying $171,612 of “NO” side shares that Trump wouldn’t be among Google’s Top 5 Most Searched People of 2025.
“Insider trading compromises the integrity of our markets, and the American people want this greed-driven conduct investigated and prosecuted,” Clayton added.
Spagnuolo’s LinkedIn profile shows he’s a staff information security engineer. In that role, Spagnuolo writes he leads the “Agent & Web Observability area in the Information Security team.”
Polymarket Claims Credit
The federal complaint against Spagnuolo will likely become part of the House Oversight Committee’s investigation into insider trading claims on federally regulated prediction markets.
In April, the DOJ charged a military master sergeant who worked on the mission to capture Venezuelan leader Nicolás Maduro with prediction market insider trading to profit $200,000.
Polymarket and its primary rival, Kalshi, both claim to have adequate safeguards in place to detect and thwart suspicious trading. As the federal charges came against Spagnuolo, Polymarket praised its integrity safeguards for pinpointing the Spagnuolo case.
Proud to announce Polymarket’s market integrity infrastructure flagged another trader who was arrested this morning in New York for insider trading. Polymarket has emerged as the enforcement leader. Blockchain trading is transparent, traceable, and bad actors leave footprints,” the prediction market posted on X.
Spagnuolo was arrested on Wednesday morning in New York. He was later released on a $2.25 million bond.
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