Federal prosecutors have accused a Google software engineer of insider trading, claiming he leveraged confidential information to earn over $1.2 million through Polymarket event contracts.
On Wednesday, the Commodity Futures Trading Commission (CFTC) filed a civil lawsuit against Michele Spagnuolo, an Italian national. Concurrently, the U.S. Attorney’s Office for the Southern District of New York revealed criminal charges including commodities fraud, wire fraud, and money laundering.
The CFTC alleges that Spagnuolo, known by the pseudonym “AlphaRaccoon,” made highly accurate trades on at least 23 Google-related contracts on Polymarket, resulting in significant profits.
According to the complaints, Spagnuolo had access to sensitive internal tools at Google, which contained nonpublic data regarding the 2025 Year in Search List, marked as “Google Confidential.” This data is considered commercially valuable as it influences advertising engagement and user traffic on Google’s search platform.
Among the contracts involved were markets related to notable figures such as Kendrick Lamar and Jimmy Kimmel. Prosecutors noted that the “AlphaRaccoon” account risked around $2.75 million across these contracts between October and December 2025, including bets on unlikely outcomes.
FBI investigations revealed that the market assigned a “near-zero probability” to d4vd becoming the most-searched person on Google, yet Spagnuolo placed significant bets on this outcome.
Authorities tracked cryptocurrency transactions linked to the “AlphaRaccoon” account across various wallets before connecting them to Spagnuolo.
U.S. Attorney Jay Clayton emphasized the importance of the charges, stating, “Corporate insiders cannot use confidential business information for personal gain in our markets.”
CFTC Chairman Michael Selig reiterated the Commission’s stance against fraud and manipulation, asserting that such actions will not be tolerated, regardless of the platform used.
The “AlphaRaccoon” account had previously garnered attention in prediction market circles for its unusual success. Following the announcement of the charges, Polymarket acknowledged its market integrity systems had flagged the trader earlier for insider trading.
In a comment, a tracking account noted that they had identified the insider trader six months prior due to his unexpectedly successful trades related to Google.