Google Engineer Charged with Insider Trading After Using Private Data for Bets

A Google software engineer has been arrested and charged with insider trading after allegedly using private company information to win bets on a prediction platform. According to BBC News, Michele Spagnuolo, an Italian citizen living in Switzerland, was arrested and brought before a federal judge in New York. The US Justice Department has charged him with crimes including wire fraud and money laundering. These charges relate to his use of confidential information from his employer to place successful bets on Polymarket, a website where people bet on the outcomes of future events.

According to The Guardian, the case involves a total profit of $1.2 million. Prosecutors say Spagnuolo used his access to Google’s internal systems to see which people were being searched for the most before that information was released to the public. He then used this knowledge to place bets on a platform that accepts cryptocurrency—a type of digital money that exists only online. By betting on results that others thought were very unlikely, he was able to make a large amount of money.

Court documents cited by Ars Technica explain that Spagnuolo used an account named “AlphaRaccoon” to place his bets. Between October and December of last year, he reportedly placed $2.7 million in bets related to Google’s search data. One of his most profitable bets involved correctly guessing that a musician named D4vd would be the most-searched person on Google in 2025. At the time he placed the bet, the platform considered this result to have a “near zero probability” of happening. However, because Spagnuolo had early access to Google’s “Year in Search” data, he knew the outcome before anyone else.

Google has responded to the situation by placing the employee on leave. A spokesperson for the company stated that while the tool used to access the information was available to many employees, using such data for personal betting is a serious violation of company policy. Google also noted that it is working closely with law enforcement to assist in the investigation. Polymarket also released a statement saying it worked with authorities to help identify the activity. A spokesperson for the platform noted that because blockchain—the digital record-keeping system used for cryptocurrency—is transparent, it is easy for investigators to follow the digital footprints left by bad actors.

This case has brought new attention to the rise of prediction markets, which have become a multibillion-dollar industry. The Guardian reports that federal agencies are now looking more closely at how these markets should be regulated. Currently, there is no single federal law in the United States that controls these betting platforms, although some states have considered creating their own rules. The US Attorney for the Southern District of New York, Jay Clayton, said in a statement that prosecutors will continue to go after corporate insiders who use private business information to make money in these markets. He added that such actions hurt the fairness of the market and that the public wants this kind of behavior stopped.

Spagnuolo, who worked as an engineer focused on information security at Google for more than 12 years, was released on a $2.25 million bond. The FBI was able to link his betting accounts to his real identity by finding an account he had opened using an Italian identification card. While the investigation into his actions continues, the case serves as a warning about the risks of using private company data for personal gain. As prediction markets continue to grow in popularity, experts suggest that regulators will likely face more pressure to create clear rules to prevent similar cases of insider trading in the future.