A Google engineer is facing federal charges after prosecutors said he used confidential search data to make more than $1.2 million on Polymarket. The case puts new scrutiny on prediction-market rules and insider trading tied to private company information.
Google Engineer Makes $1.2M on Polymarket Using Confidential Search Data
WRITTEN BY
SHARE
Key Takeaways
- Authorities accused a Google employee of using internal data to trade Polymarket contracts.
- The case could shape how regulators police prediction markets tied to company information.
- Possible penalties include criminal charges, civil fines, trading bans, and prison time.
Google Search Data Case Tests Polymarket’s Market-Integrity Rules
Google software engineer Michele Spagnuolo was charged with commodities fraud, wire fraud, and money laundering after authorities accused him of using confidential Google data to profit from Polymarket contracts. Prosecutors said he made more than $1.2 million through a Polymarket account known as “AlphaRaccoon,” according to the U.S. Department of Justice (DOJ).
The case focuses on Google’s 2025 Year in Search results. Prosecutors said Spagnuolo accessed internal search rankings labeled “Google Confidential” and used that data to trade contracts tied to the most searched person and the top five searched people of 2025. Authorities said he risked about $2.75 million between Oct. 15, 2025, and Dec. 4, 2025.
U.S. Attorney Jay Clayton said:
“Corporate insiders cannot use confidential business information to turn a profit in our markets.”
According to the complaint, the markets were still trading while Google’s Year in Search rankings remained confidential. Prosecutors said Spagnuolo could view the rankings internally before their release, allowing him to buy and sell contracts based on information unavailable to other participants.
CFTC Action Highlights Crypto Rails Behind Event Contracts
The Commodity Futures Trading Commission (CFTC) also filed a civil complaint seeking restitution, disgorgement, civil penalties, trading and registration bans, and a permanent injunction. Its action frames prediction markets as venues where insider-trading rules can apply when event contracts rely on nonpublic business information.
The complaint said the contracts traded in USDC.e, a bridged stablecoin pegged 1:1 to the U.S. dollar. Polymarket has since replaced USDC.e as its primary collateral token with Polymarket USD (pUSD), a Polygon ERC-20 token backed 1:1 by USDC. Winning shares paid $1, while losing shares paid nothing.
CFTC Chairman Michael S. Selig said:
“The Commission will not tolerate fraud, manipulation, or insider trading, regardless of the technology or platform that is used.”
Investigators traced the AlphaRaccoon account to cryptocurrency wallets that prosecutors said funded Polymarket positions and received trading proceeds. Spagnuolo, 36, is an Italian citizen living in Switzerland. The charges carry maximum penalties of 10 years for commodities fraud, 20 years for wire fraud, and 20 years for money laundering.
