Overview
- Federal prosecutors in the Southern District of New York unsealed a complaint May 27, 2026, charging Google software engineer Michele Spagnuolo with commodities fraud, wire fraud, and money laundering.
- Prosecutors allege Spagnuolo opened an account called “AlphaRaccoon” in May 2024 and used nonpublic Google search‑trend data to place Polymarket bets between October 15 and December 4, 2025, winning roughly $1.2 million from about $2.75 million in wagers.
- The complaint says Spagnuolo accessed an internal Google tool labeled “Google Confidential,” breached confidentiality and ethics agreements, and then moved proceeds through cryptocurrency swaps and privacy services, triggering a money‑laundering count.
- Google has placed the employee on leave and Polymarket cooperated with investigators, and the case is being handled by the SDNY Securities and Commodities Fraud Task Force with parallel civil enforcement reported by the CFTC.
- The charges carry statutory maximums that total up to 50 years in prison but sentencing will be set later, and the case underlines how prosecutors are applying traditional fraud statutes to prediction‑market trading which could prompt rule changes or tighter platform controls.