Federal prosecutors in Manhattan on Wednesday unsealed criminal charges against a Google staff security engineer, accusing him of using confidential internal search-trend data to win roughly $1.2 million on Polymarket contracts tied to Google's own Year in Search rankings.
The complaint, filed in the Southern District of New York, charges Michele Spagnuolo, 36, an Italian citizen living in Switzerland, with commodities fraud, wire fraud and money laundering. The Commodity Futures Trading Commission filed a parallel civil insider-trading suit. It is the second federal insider-trading prosecution tied to Polymarket in just over a month.
The trades
Prosecutors say Spagnuolo, a staff information security engineer with access to an internal Google tool that surfaced nonpublic Year in Search data, placed bets from October through December using the Polymarket username "AlphaRaccoon." Total wagers ran to about $2.75 million, according to the complaint cited by Al Jazeera.
The biggest payoff came on the contract for Google's most-searched person of 2025. Spagnuolo correctly bet on D4vd, the indie pop singer who drew nationwide attention last year after a 15-year-old's dismembered body was found in a car registered to him. When the bet was placed, prosecutors wrote, the market assigned a "near-zero probability" to that outcome. CNBC reported he also bet correctly on contracts asking whether Zohran Mamdani would land in the top five most-searched people and whether "Squid Game" would be the No. 1 searched television show.
Google published its 2025 Year in Search results on or about Dec. 4, 2025. The AlphaRaccoon account cleared roughly $1.2 million in profit soon after, the complaint says, and Spagnuolo allegedly moved the proceeds through a cryptocurrency wallet to obscure their source.
The response
Spagnuolo appeared before a federal magistrate judge in New York, did not enter a plea and was released on a $2.25 million bond. NBC News reported he did not immediately respond to a request for comment; CBS News said it had reached out to his attorney. No defense statement had been issued by press time.
Google placed Spagnuolo on leave. "The employee accessed our marketing material using a tool available to all employees, but using such confidential information to place bets is a serious breach of our policies," a Google spokesperson said. Polymarket said it had flagged the trader and cooperated with prosecutors, calling itself "the only prediction platform to date whose cooperation has led to insider trading charges in the United States." U.S. Attorney Jay Clayton said the charges "reinforce a decades-old message: corporate insiders cannot use confidential business information to turn a profit in our markets."
Regulatory backdrop
The case lands as the CFTC takes a harder look at prediction markets, which have grown sharply in user volume and political prominence. It follows the April arrest of U.S. Army Special Forces master sergeant Gannon Ken Van Dyke, accused of making more than $400,000 on contracts tied to the U.S. operation that captured former Venezuelan president Nicolás Maduro. Van Dyke pleaded not guilty.
Nothing in the filings has been tested in court. Polymarket has pressed the point that on-chain trading is traceable, a feature it sells to regulators even as the SDNY case turns its own ledger into evidence. Spagnuolo is due back in federal court in Manhattan; the CFTC's civil case will proceed on a separate track.