U.S. prosecutors have charged a Google employee with insider trading, alleging that the software engineer used confidential company information to earn over $1.2 million on the prediction market platform Polymarket. The charges, announced this week, stem from bets placed on search trends.
The complaint, unsealed in New York, identifies the employee as Michele Spagnuolo, a 36-year-old Italian citizen residing in Switzerland. Spagnuolo reportedly accessed unpublished data from Google’s 2025 ‘Year in Search’ to place wagers on the platform, betting on which individuals would be trending in searches last year.
The complaint alleges that Spagnuolo, operating under the online alias ‘AlphaRaccoon,’ made trades on Polymarket as Google’s internal search data evolved from October to December of last year. Initially, Spagnuolo bet that Kendrick Lamar would top the search trends, but later adjusted bets based on internal data indicating that alt-pop singer D4vd was gaining traction.
Jay Clayton, U.S. Attorney for the Southern District of New York, stated that these charges highlight a long-standing principle: corporate insiders must not exploit confidential information for profit. He emphasized that insider trading undermines market integrity and that the public demands accountability for such actions.
Google has confirmed that Spagnuolo has been placed on leave. A spokesperson for the company stated that while the employee accessed marketing material using a tool available to all employees, using confidential information for betting constitutes a severe violation of company policies. Google is cooperating with law enforcement in the investigation.
Polymarket has expressed its commitment to working closely with authorities regarding this case. A spokesperson noted that the platform is the only prediction market whose cooperation has resulted in insider trading charges in the United States, highlighting the transparency and traceability of blockchain trading.
Spagnuolo is not the first individual to face charges related to Polymarket trades. Recently, a special forces soldier was charged for making over $400,000 from trades based on classified information regarding the U.S. military’s operations. These incidents have sparked discussions about the speculative nature of prediction markets and the regulatory challenges they present.
Spagnuolo faces serious charges under the U.S. Commodity Exchange Act, as well as allegations of wire fraud and money laundering. If convicted, he could face significant prison time.