Google employee charged with fraud over $1.2 million Polymarket bets
A Google security engineer allegedly turned confidential search data into $1.2 million in Polymarket bets, exposing a new frontier for insider abuse.
Federal prosecutors said a Google employee used confidential search data to profit from prediction markets, turning a public-looking bet on 2025 search trends into a $1.2 million windfall. Michele Spagnuolo, 36, was charged with commodities fraud, wire fraud and money laundering after investigators tied the trades to an account named AlphaRaccoon.
The criminal complaint says Spagnuolo knew the result before the market did because he had access to Google’s internal data. Prosecutors said he correctly bet that the singer d4vd would be Google’s most-searched person in 2025, even though Polymarket gave that outcome near-zero probability at the time of the wager. Google announced its Year in Search 2025 results on Dec. 4, 2025, and prosecutors said the related bets then paid off handsomely.
The case cuts to the logic of prediction markets themselves. Polymarket markets are meant to aggregate dispersed information, but the platform’s own rules for the “#1 Searched Person on Google this year” contract said it would resolve based on Google’s official Year in Search list for 2025. That structure works only if participants are betting with broadly available information. When a trader can see internal corporate signals before the market, the platform stops behaving like a neutral forecasting tool and starts looking a lot like an insider-trading venue with better branding.
Spagnuolo was arrested in New York, appeared briefly before a federal magistrate judge and did not enter a plea. He was released on a $2.25 million bond, secured by $1 million in cash, with $50,000 required immediately. ABC News identified him as a Google information security engineer or software engineer with access to data tracking user searches, a detail that, if proven, would make the alleged conduct especially damaging because the value of the bet came from privileged access, not skillful public analysis.
Google said it was working with law enforcement, that the employee accessed marketing material using a tool available to all employees, and that using confidential information to place bets was a serious breach of policy. The company placed him on leave and said it would take appropriate action. The episode also arrives as federal prosecutors widen scrutiny of prediction markets: in April, the U.S. Attorney’s Office for the Southern District of New York charged Army soldier Gannon Ken Van Dyke with allegedly using classified information to profit from Polymarket bets tied to a U.S. military operation in Venezuela.
Taken together, the cases suggest a regulatory gap at the intersection of tech, finance and gambling. The question is no longer whether prediction markets can price public information; it is whether regulators can police misconduct when the edge comes from inside access that is neither classic securities trading nor ordinary gambling, but something in between.
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