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U.S. prosecutors slapped insider trading charges against a Google employee this week, alleging the software engineer used confidential company information to pocket more than $1.2 million from prediction market platform Polymarket with bets on search trends.
In a complaint unsealed in New York, authorities identified the employee as 36-year-old Michele Spagnuolo — an Italian citizen residing in Switzerland who has worked for Google since 2014. Under the online name “AlphaRaccoon,” they alleged, Spagnuolo used the company’s 2025 “Year in Search” data before it was published to enter Polymarket wagers about the most trending Googled people of last year.
This week’s charges “reinforce a decades-old message: corporate insiders cannot use confidential business information to turn a profit in our markets,” Jay Clayton, U.S. Attorney for the Southern District of New York, said Wednesday. “Insider trading compromises the integrity of our markets, and the American people want this greed-driven conduct investigated and prosecuted.”
Spagnuolo allegedly made new Polymarket trades as Google’s internal search data evolved, from October into December of last year. For example, per the complaint, Spagnuolo initially wagered that Kendrick Lamar — who headlined the 2025 Super Bowl halftime show — would top search trends for people last year. But after internal Google data showed that alt-pop singer D4vd was later leading the influx of searches, he placed new bets. D4vd, whose legal name is David Burke, was charged last month with murdering 14-year-old Celeste Rivas Hernandez.
Using the prediction market’s “yes” or “no” wagers, Spagnuolo also made a series of Polymarket trades about other individuals who would or wouldn’t rank in Google’s 2025 search trends, the complaint said. And after the data was published on Dec. 4, the AlphaRaccoon account soon pocketed sizeable profits. An FBI investigation later traced its cryptocurrency payments.
An attorney for Spagnuolo was not immediately identified. California-based Google confirmed to The Associated Press it had placed its employee 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 in a statement — adding the company was working with law enforcement and “will take the appropriate action.”
Polymarket reiterated it too worked closely with authorities. A spokesperson also touted that the company “is the only prediction platform to date whose cooperation has led to insider trading charges in the United States” — and maintained blockchain trading, which Polymarket uses, is “transparent, traceable, and bad actors leave footprints.”
Spagnuolo isn’t first person to face insider trading charges spanning from Polymarket trades. Last month, the government also charged a special forces soldier who made over $400,000 from Polymarket trades betting on the downfall of former Venezuelan President Nicolás Maduro. The solider allegedly used classified information ahead of January’s U.S. military operation, which he was a part of.
Such scandals have put the spotlight on a murky (and growing) world of speculative, 24/7 transactions now filling the internet. Prediction markets sell event contracts — so they’re also categorized and regulated differently from traditional forms of gambling. That’s raised concerns about consumer protections, and legal battles over government oversight.
President Donald Trump’s administration has already thrown its support behind company operators — and sued several states over their regulation efforts. Meanwhile, the industry is scrambling to assure the public with new guardrails. Polymarket recently rewrote its rules to clearly state users cannot trade on contracts where they might possess confidential information, or could influence the outcome of an event.
Spagnuolo is being charged with violating the U.S. Commodity Exchange Act, wire fraud and money laundering. He could face years of prison time.
