Google engineer charged with insider trading on Polymarket after allegedly netting $1.2M

A Google software engineer allegedly turned confidential company data into a personal casino, placing roughly $2.75 million in bets on Polymarket and walking away with over $1.2 million in profits. The US Department of Justice has now charged him with commodities fraud, wire fraud, and money laundering.

Michele Spagnuolo was charged on May 27 in the Southern District of New York. Federal prosecutors allege he used an internal Google tool to access restricted data from the company’s “Year in Search 2025” report, then bet on which names and topics would top Google’s annual search rankings.

The ‘AlphaRaccoon’ account and a near-perfect record

Spagnuolo allegedly operated under the Polymarket username “AlphaRaccoon.” The account’s track record was, to put it mildly, suspicious: 22 correct predictions out of 23 total bets.

The alleged scheme ran between October 15 and December 4, 2025. During that window, Spagnuolo reportedly placed bets tied to significant cultural events and trending search topics he could preview through internal data. One notable wager involved the artist D4vd, whom Spagnuolo allegedly predicted would top search trends shortly before a public announcement following D4vd’s arrest in April 2026.

The legal fallout

The charges carry significant prison time. Commodities fraud alone could mean up to 10 years behind bars. Wire fraud and money laundering each carry a maximum of 20 years.

Following his arrest, Spagnuolo appeared before a magistrate and was released on a $2.25 million bond. Google has placed him on administrative leave, stating that he accessed sensitive marketing material through an employee-available tool, calling it a serious breach of internal policies regarding confidential data access.

The Commodity Futures Trading Commission has also initiated a civil action against Spagnuolo, seeking financial penalties and disgorgement.

This isn’t the first time federal prosecutors have gone after someone for alleged insider trading on Polymarket. It’s the second known DOJ criminal inquiry of this kind, following a previous case involving a US Army soldier.

What this means for prediction markets and crypto investors

Congress has been investigating the safeguards, or lack thereof, that prediction markets like Polymarket have in place to prevent exactly this kind of exploitation. Polymarket has also recently partnered with Chainalysis, a blockchain analytics firm, to enhance its fraud detection capabilities.