Federal authorities have filed insider trading charges against a Google software engineer this week, accusing him of exploiting internal company data to earn more than $1.2 million through bets placed on the prediction market platform Polymarket.
Court documents unsealed in New York reveal the accused is Michele Spagnuolo, a 36-year-old Italian national living in Switzerland who has been employed by Google since 2014. Prosecutors claim that operating under the username “AlphaRaccoon,” Spagnuolo accessed Google’s 2025 “Year in Search” information prior to its public release and used it to place bets on which individuals would become the most searched people of the previous year.
“This week’s charges reinforce a decades-old message: corporate insiders cannot use confidential business information to turn a profit in our markets,” stated Jay Clayton, U.S. Attorney for the Southern District of New York, on Wednesday. “Insider trading compromises the integrity of our markets, and the American people want this greed-driven conduct investigated and prosecuted.”
According to the criminal complaint, Spagnuolo continued placing fresh Polymarket bets as Google’s internal search statistics changed throughout October and December of last year. The filing indicates that Spagnuolo first bet on Kendrick Lamar — who performed at the 2025 Super Bowl halftime show — expecting him to lead search trends. However, when internal Google information revealed that alt-pop artist D4vd was actually generating more searches, he shifted his betting strategy. D4vd, whose real name is David Burke, faces murder charges from last month in connection with the death of 14-year-old Celeste Rivas Hernandez.
Through Polymarket’s “yes” or “no” betting system, Spagnuolo placed multiple wagers on various people who might appear in Google’s 2025 search trend rankings, according to prosecutors. Following the public release of the search data on December 4, the AlphaRaccoon account collected substantial winnings. Federal investigators later tracked the account’s cryptocurrency transactions.
No legal representative for Spagnuolo has been publicly identified. Google, headquartered in California, confirmed to The Associated Press that the employee has been suspended.
“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 stated — noting the company is cooperating with law enforcement and “will take the appropriate action.”
Polymarket also emphasized its cooperation with investigators. A company spokesperson highlighted that Polymarket “is the only prediction platform to date whose cooperation has led to insider trading charges in the United States” — and stressed that blockchain-based trading, which Polymarket employs, is “transparent, traceable, and bad actors leave footprints.”
This case marks the second insider trading prosecution connected to Polymarket activity. Federal prosecutors charged a special forces soldier last month who allegedly earned more than $400,000 through Polymarket bets on former Venezuelan President Nicolás Maduro’s political fate. That soldier reportedly used classified intelligence related to a January U.S. military operation in which he participated.
These controversies have highlighted growing concerns about the expanding world of round-the-clock speculative trading platforms online. Prediction markets offer event-based contracts — placing them under different regulatory frameworks than conventional gambling operations. This distinction has sparked debates about consumer safeguards and government oversight authority.
The current administration under President Donald Trump has backed industry operators — even filing lawsuits against states attempting to regulate these platforms. The industry is working to rebuild public confidence through enhanced oversight measures. Polymarket recently updated its terms of service to explicitly prohibit users from trading on contracts where they might have access to confidential information or could affect an event’s outcome.
Spagnuolo faces charges under the U.S. Commodity Exchange Act, along with wire fraud and money laundering violations. If convicted, he could receive several years in federal prison.
