Polymarket launches probe after report alleges deceptive marketing

Prediction market platform Polymarket is conducting an internal audit of its promotional materials after a Wall Street Journal investigation uncovered allegations of deceptive marketing. The WSJ report, published Saturday, claims the company paid online content creators to produce videos that misrepresented customer winnings, often featuring fabricated trades on simulated platforms.

The investigation, based on interviews with social media creators and analysis of over 1,100 TikTok videos, suggests these practices were part of a campaign to attract users to Polymarket's offshore, unregulated platform. The Journal reported that some videos depicted creators winning substantial amounts, such as $100,000 from a $1,000 bet on a celebrity's public statement, while actual trades on Polymarket showed losses. The company also allegedly hired marketing contractors to amplify this content.

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As the world's leading prediction market, we are committed to maintaining accurate, fair and transparent markets. We are part of a rapidly growing industry and are constantly evaluating ways to improve how we're engaging and earning the trust of our audience.

In response, a Polymarket spokesperson told CBS News, "As the world's leading prediction market, we are committed to maintaining accurate, fair and transparent markets. We are constantly evaluating ways to improve how we're engaging and earning the trust of our audience." The company confirmed it is undertaking a comprehensive audit of active promotional content to ensure it aligns with their standards and relevant legal requirements.

This situation unfolds as Polymarket faces existing scrutiny. The platform, which allows users to wager on future events, has been investigated for alleged insider trading. Federal prosecutors recently accused a Google employee of profiting over $1.2 million using confidential business information on Polymarket. A data analyst also previously reported spotting multiple instances of Polymarket accounts accumulating significant winnings through bets on U.S. military operations, raising concerns about suspicious win rates. Polymarket maintains that insider trading is prohibited on its platform and updated its rules in March to address such activities.

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As part of that commitment, we are conducting a comprehensive audit of active promotional content to ensure it complies with our standards, as well as applicable regulatory and legal disclosure requirements.