The United States Department of Justice (DOJ) has charged a Google (NASDAQ: GOOGL) employee with insider trading after uncovering a scheme to misappropriate confidential company information and use it to place a series of profitable trades on the prediction market platform Polymarket.
On Wednesday, U.S. Attorney for the Southern District of New York, Jay Clayton, and Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (FBI), James C. Barnacle, Jr., announced the unsealing of a complaint charging Michele Spagnuolo, a software engineer at Google, with commodities fraud, wire fraud, and money laundering.
The DOJ alleges that Spagnuolo, also known by his Polymarket profile “AlphaRaccoon,” abused his access to Google’s internal data systems to obtain nonpublic data that he then used to place trades in various markets on the prediction platform.
In total, from October 15, 2025, through to December 4, 2025, Spagnuolo allegedly used his AlphaRaccoon account to risk approximately $2,754,092 on markets related to Google’s internal information. After the information became public and the markets resolved, Spagnuolo’s AlphaRaccoon account profited approximately $1.2 million.
“Michele Spagnuolo allegedly abused his elevated access to confidential trends to place bets with nonpublic information and receive more than one million dollars in unlawful profits,” said FBI Assistant Director in Charge Barnacle, Jr. “The FBI remains dedicated to searching for fraudsters who betray their employer for personal financial gains.”
This was echoed by U.S. Attorney Clayton, who said that “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.”
He added that “today’s charges reinforce a decades-old message: corporate insiders cannot use confidential business information to turn a profit in our markets.”
Spagnuolo, an Italian citizen residing in Switzerland, was presented before U.S. Magistrate Judge Sarah Netburn in the Southern District of New York on Wednesday and charged with one count of violating the Commodity Exchange Act, which carries a maximum sentence of 10 years in prison; one count of wire fraud, which carries a maximum sentence of 20 years in prison; and one count of money laundering, which carries a maximum sentence of 20 years in prison.
He faces a potential 50 years behind bars if convicted on all counts.
More bad press for Polymarket
The DOJ charges are likely the last thing prediction platform Polymarket needed in a week that saw Indonesia become the latest in a growing list of jurisdictions to block the platform.
The platform’s activities have been controversial and under scrutiny for some time. In January 2022, Polymarket was fined $1.4 million and ordered to wind down its services in the U.S. by the country’s commodities regulator, the Commodity Futures Trading Commission (CFTC), for violating the Commodity Exchange Act (CEA) and other applicable CFTC regulations with its products.
Since then, a number of other countries have also taken steps to ban or limit access to Polymarket, as well as other prediction market platforms, including Singapore, India, Taiwan, Thailand, China, and Japan.
In March this year Argentina joined this list when a court ordered a nationwide block of Polymarket, citing concerns that the platform operates as an unlicensed online betting system.
The following month, neighboring country Brazil also enacted a sweeping ban on prediction markets and betting platforms, according to local media and government filings. Polymarket and fellow leading prediction market, Kalshi, were reportedly among the platforms to be made inaccessible.
Indonesia’s blocking of the platform, announced last Friday, was part of a broader crackdown on online gambling in the country.
Watch | Unlocking crypto futures: Key takeaways from Blockchain Futurist 2025
Be the first to comment