Google engineer charged with insider trading on Polymarket after netting $1.2 m. on search data

A Google software engineer has been charged by the U.S. Justice Department with leveraging insider information to manipulate bets on the prediction market Polymarket, illicitly profiting $1.2 million. Michele Spagnuolo, a 36-year-old Italian national residing in Switzerland, allegedly exploited confidential data related to Google's trending searches to place highly profitable wagers.

According to the unsealed complaint, Spagnuolo used his privileged access to Google's internal data to bet on individuals appearing on the company's most-searched list. Notably, he allegedly placed a bet on November 27 that indie pop musician D4vd would top the list, a prediction that yielded significant returns due to the "near-zero probability" assigned by the market. D4vd had become the most-searched person of the year after his arrest for murder.

Spagnuolo, operating under the account name "AlphaRaccoon," also allegedly used insider information for other bets. In October, he bet on rapper Kendrick Lamar topping the list, at a time when Google's internal data indicated Lamar was on track to be the most-searched individual. This pattern of behavior suggests a deliberate scheme to exploit non-public information for financial gain.

U.S. Attorney for the Southern District of New York, Jay Clayton, stated that prosecutors are committed to pursuing corporate insiders who misuse confidential business information for profit in prediction markets. Google confirmed it is working with law enforcement and has placed Spagnuolo on leave, emphasizing that using confidential information for betting is a serious breach of company policy. Polymarket also confirmed its cooperation with law enforcement in the investigation.

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Insider trading compromises the integrity of our markets, and the American people want this greed-driven conduct investigated and prosecuted.