FBI says Google engineer used internal search data to win $1.2M on Polymarket

FBI says Google engineer used internal search data to win $1.2M on Polymarket - Ars Technica

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The US charged a Google software engineer with insider trading after he allegedly made a profit of $1.2 million on Polymarket bets related to which public figures would top Google’s rankings for the most searched names in 2025. Michele Spagnuolo, an Italian citizen who lives in Switzerland, “was arrested on Wednesday and brought before a federal judge in New York,” the BBC wrote. Spagnuolo was charged “with commodities fraud, wire fraud, and money laundering arising from his scheme to misappropriate confidential information from his employer and use that information to place a series of profitable Google-related trades on a prediction market platform,” the Justice Department announced yesterday. An unsealed criminal complaint said that Spagnuolo, using the account name “AlphaRaccoon” on Polymarket, made bets on who would be the most-searched people on Google in 2025. “Unlike the counterparties to his trades, Spagnuolo knew the outcome of these wagers before the trading public did because he had accessed Google’s confidential, commercially valuable internal data,” the complaint said. Spagnuolo had access to internal Google systems, including a software tool with “confidential, nonpublic Year in Search data,” FBI Special Agent Brandon Racz wrote in the complaint. Spagnuolo allegedly bet over $2.7 million and made a $1.2 million profit after Google publicly announced its Year in Search 2025 results in early December. He also apparently made over $1 million on other profitable bets on Polymarket, but the FBI didn’t say what those other bets were for. Google says he used “tool available to all employees” Google said it suspended the employee and is cooperating with law enforcement.

“We’re working with law enforcement on their investigation,” Google said in a statement provided to Ars. “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. We’ve placed the employee on leave and will take the appropriate action.” Between October 15, 2025, and December 4, 2025, “Spagnuolo’s AlphaRaccoon account risked approximately $2,754,092 on approximately 25 Google Year in Search 2025 outcomes that the market treated as unlikely,” the US complaint said. Spagnuolo’s bets included $937,688 on the “No” side of “Will Bianca Censori be the #1 searched person on Google this year?”; $613,587 on the “No” side of “Will Pope Leo XIV be the #1 searched person on Google this year?”; $509,149 on the “No” side of “Will Donald Trump be the #1 searched person on Google this year?”; and $171,612 on the “No” side of “Will Donald Trump rank in Google’s Top 5 Most Searched People of 2025?” The AlphaRaccoon account also made bets related to Zohran Mamdani, Kendrick Lamar, Jimmy Kimmel, d4vd, Sydney Sweeney, Tyler Robinson, Charlie Kirk, Luigi Mangione, Elon Musk, Taylor Swift, Squid Game, and Andy Byron. AlphaRaccoon’s winning bets did not go unnoticed by people who watch prediction markets. “In or about early December 2025, after Discord and X communities discussed AlphaRaccoon, and speculated its user was a Google insider, the ‘AlphaRaccoon’ username was removed from the Polymarket account, reverting the username to an alphanumeric wallet address,” the US complaint said. Spagnuolo won bets “with near-perfect accuracy” Spagnuolo was also charged in a civil complaint by the US Commodity Futures Trading Commission (CFTC). The criminal and civil complaints were both filed in US District Court for the Southern District of New York. Spagnuolo made at least 23 bets on “Yes” or “No” shares and won “with near-perfect accuracy,” the CFTC complaint against Spagnuolo said.

The criminal complaint said Spagnuolo “attempted to conceal his unlawful proceeds and his association to accounts used in his scheme,” but that the FBI was able to connect him to the wagers after reviewing documents provided by Polymarket, information available on cryptocurrency blockchains, and records from cryptocurrency services companies. The AlphaRaccoon Polymarket account was allegedly funded by a cryptocurrency wallet identified as Wallet-0xAf6. “Through a series of transactions in November 2025, Wallet-0xAf6 sent cryptocurrency to a particular cryptocurrency swapping service and then to a particular cryptocurrency payment processor, which were received by an account in Spagnuolo’s name which was opened using Spagnuolo’s Italian Government identification card,” the CFTC complaint said. After the $2.7 million in bets netted a $1.2 million profit, the AlphaRaccoon Polymarket account received over $3.9 million in USDC.e, a stablecoin pegged to the value of the US dollar, the CFTC said. The account then sent over $5 million to Wallet-0xAf6. The extra money “appear[s] to be proceeds of other profitable Polymarket trades made by the AlphaRaccoon Polymarket account,” the FBI complaint said. The criminal charges have combined maximum penalties of 50 years in prison, though any sentence would be determined by a judge if Spagnuolo is convicted. The CFTC complaint seeks disgorgement of profits and monetary penalties. CFTC Chairman Michael Selig said the complaint against Spagnuolo “underscores our commitment to rooting out insider trading and promoting market integrity in prediction markets.” The CFTC has asserted exclusive jurisdiction over prediction markets and is suing US states that attempt to impose prediction-market laws that are stricter than US regulations.

Jon Brodkin

Senior IT Reporter

Jon Brodkin Senior IT Reporter

Jon is a Senior IT Reporter for Ars Technica. He covers the telecom industry, Federal Communications Commission rulemakings, broadband consumer affairs, court cases, and government regulation of the tech industry.

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