Google Security Engineer Arrested in Million-Dollar Polymarket Trading Scheme | WIREDSkip to main contentMenuSECURITYPOLITICSTHE BIG STORYBUSINESSSCIENCECULTUREREVIEWSMenuAccountAccountNewslettersSecurityPoliticsThe Big StoryBusinessScienceCultureReviewsChevronMoreExpandThe Big InterviewMagazineEventsWIRED InsiderWIRED ConsultingNewslettersPodcastsVideoLivestreamsMerchSearchSearchKate KnibbsBusinessMay 27, 2026 6:22 PMGoogle Security Engineer Arrested in Million-Dollar Polymarket Trading SchemeAccording to federal prosecutors, Michele Spagnuolo made more than $1 million on the prediction market platform using confidential information about Google Search traffic.Photograph: Benjamin Fanjoy/Getty ImagesCommentLoaderSave StorySave this storyCommentLoaderSave StorySave this storyA Google security engineer has been charged with crimes stemming from allegedly placing trades on Polymarket using confidential internal information from the tech giant. Michele Spagnuolo, a 36-year-old Italian citizen, was arrested this morning in New York, as first reported by ABC News.Spagnuolo is charged with one count each of commodities fraud, wire fraud, and money laundering. He has worked at Google since 2014 and was based out of the company’s Zurich, Switzerland, offices.According to the complaint, Spagnuolo placed trades on Polymarket from around October 2025 to December 2025 using internal Google data. In one instance, he netted $1.2 million trading on who Google’s most-searched person of the year would be in 2025, correctly predicting that the winner would be D4vd, a once obscure singer who became the subject of intense public scrutiny after he was suspected of murder. (D4vd was ultimately charged in the case in April.)“Unlike the counterparties to his trades, Spagnuolo knew the outcome of these wagers before the trading public did because he had accessed Google’s confidential, commercially valuable internal data,” FBI agent Brandon Racz wrote in the complaint.Got a Tip?Do you have information about what's happening on prediction markets? We'd like to hear from you. Using a nonwork phone or computer, contact the reporter securely on Signal atKateknibbs.09.This is the second known arrest in the United States for illicit activity on prediction markets. In April, a US Army special forces officer was arrested for allegedly placing bets on markets related to the capture of former Venezuelan leader Nicolás Maduro. Both cases have been brought by the Southern District of New York.OpenAI fired an employee earlier this year for using insider information to make trades on a prediction platform, but this is the first time that a tech worker has been arrested for their alleged activity.Polymarket has come under fire from lawmakers for its reputation as a hub of illegal activity. Last week, House Committee on Oversight and Government Reform chairman James Comer launched an investigation into insider trading on prediction markets platforms and requested information from Polymarket about how the company vets its customers. There are two versions of Polymarket: a smaller platform that is legal in the United States and a much larger offshore version that is technically blocked in the US and where traders use cryptocurrency to place their wagers."We’re working with law enforcement on their investigation. 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. We’ve placed the employee on leave and will take the appropriate action,” Google spokesperson Jaclyn Vazquez said in a statement to WIRED."Polymarket worked closely with the US Attorney’s Office for the Southern District of New York and [the Commodity Futures Trading Commission], and is the only prediction platform to date whose cooperation has led to insider trading charges in the United States,” Polymarket spokesperson Connor Brandi told WIRED. “Blockchain trading is transparent, traceable, and bad actors leave footprints. 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 a social media post, Polymarket said the arrest was the result of a referral it made to authorities.Anyone can trace activity on Polymarket’s crypto-based platform, since all of the wallet transactions are public. Spagnuolo allegedly made his trades using an account with the user name AlphaRaccoon, which Polymarket watchers had long speculated may have belonged to a Google insider, since the odds of correctly predicting the answers to the questions he wagered on were so improbable.Earlier this month, Michael Selig, chairman of the CFTC, which is tasked with regulating prediction markets in the US, told WIRED that the agency is using artificial intelligence tools to hunt for market manipulation and insider trading in the industry.CommentsBack to topTriangleYou Might Also LikeHow to find us: Add WIRED.com to your preferred sources in GoogleThese women are trying to optimize their vaginasBig Story: AI gig work is the new waiting tables—and it's soul-crushingThis summer, the American water crisis becomes realEvent: How to adapt, compete, and win in the next era of businessKate Knibbs is a senior writer at WIRED. She covers prediction markets, the future of media, and how AI is changing the internet. She’s also interested in digital grey markets and regulatory battles over new tech. She is based in Chicago. Send tips to [email protected], or reach her on Signal ... 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A Google security engineer named Michele Spagnuolo has been charged with commodities fraud, wire fraud, and money laundering stemming from alleged trades made on the prediction market platform Polymarket using confidential internal information from Google. Spagnuolo, a 36-year-old Italian citizen who worked at Google based in Zurich, Switzerland since 2014, allegedly utilized this private internal data to place lucrative wagers between October and December 2025. In one specific instance, he reportedly profited $1.2 million by correctly predicting the winner of a prediction regarding Google’s most-searched person of the year in 2025. The prosecution argued that Spagnuolo possessed knowledge of the outcomes before the public, as he had accessed commercially valuable, confidential internal data of the tech giant.

This incident highlights significant concerns regarding the use of insider information in prediction markets. Polymarket operates two versions: a smaller platform legal in the United States and a larger offshore version utilizing cryptocurrency. The platform has faced scrutiny from lawmakers regarding its reputation as a venue for illegal activity, prompting investigations into how customer vetting is conducted. Despite these concerns, Polymarket spokesperson stated cooperation with law enforcement and emphasized that blockchain trading is inherently transparent and traceable, allowing bad actors to leave digital footprints. The platform noted that the arrest resulted from a referral to authorities.

The context of this case is part of a broader trend where prediction markets are increasingly scrutinized for insider trading. This is not an isolated event; it marks the second known arrest in the United States concerning illicit activity on these platforms, following an arrest involving a US Army special forces officer who placed bets related to the capture of Nicolás Maduro. Furthermore, the case draws attention to the regulatory response to these digital markets. The chairman of the Commodity Futures Trading Commission, Michael Selig, indicated that the agency is employing artificial intelligence tools to actively search for market manipulation and insider trading within the prediction market industry. The situation underscores the tension between the transparency offered by blockchain technology and the potential for exploiting confidential data within major technology corporations.