WASHINGTON, May 27, 2026 — The Commodity Futures Trading Commission said Wednesday it filed a civil enforcement action against a Google employee accused of using confidential internal search-trend data to trade event contracts on prediction-market platform Polymarket, in a case that adds to U.S. regulatory scrutiny of blockchain-based event markets.
The CFTC alleged that Michele Spagnuolo, a Switzerland-based software engineer at Google, misappropriated sensitive nonpublic information related to Google’s official 2025 “Year in Search” rankings and used the data to place trades on Polymarket contracts tied to annual search results.
According to the complaint filed in the U.S. District Court for the Southern District of New York, Spagnuolo allegedly generated approximately $1.2 million in profits through the trading activity.
The regulator said it is seeking restitution, disgorgement, civil monetary penalties, trading and registration bans, and a permanent injunction against further violations of the Commodity Exchange Act and CFTC regulations.
“As I have said repeatedly, the Commission will not tolerate fraud, manipulation, or insider trading, regardless of the technology or platform that is used,” CFTC Chairman Michael S. Selig said in a statement.
Alleged use of confidential Google search data
According to the complaint, Spagnuolo accessed confidential internal Google information concerning the company’s unreleased 2025 “Year in Search” rankings via an internal software tool at Google.
The CFTC alleged that, as a Google employee, Spagnuolo owed a duty of trust and confidentiality to maintain the secrecy of the information and not use it for personal financial gain.
The filing states that between October and December 2025, Spagnuolo purchased “Yes” and “No” shares across at least 23 event contracts tied to Google search rankings, including contracts related to the most-searched people, actors, television shows and public figures of the year.
The complaint alleges that Spagnuolo used the Polymarket handle “AlphaRaccoon” and achieved near-perfect accuracy across the positions.
Among the markets cited in the filing were contracts tied to whether Donald Trump, Kendrick Lamar, Taylor Swift, Zohran Mamdani, Elon Musk and other public figures would rank among Google’s most-searched people in 2025.
Filing details Polymarket infrastructure
The complaint also provides detailed descriptions of Polymarket’s infrastructure and operational structure.
According to the filing, Polymarket operates through a decentralized-finance protocol on the Polygon blockchain and uses the UMA Oracle system to resolve event-contract outcomes.
The filing states that users can propose event outcomes to the UMA Oracle, after which disputes may trigger voting by UMA token holders before contracts are resolved. Winning positions are redeemable for USDC.e, a bridged version of the USDC stablecoin operating within the Polygon ecosystem.
The CFTC additionally alleged that Polymarket’s Markets Team managed the creation and deployment of manually listed event contracts from New York.
CFTC says event contracts qualify as swaps
A central element of the complaint is the CFTC’s characterization of prediction-market event contracts as swaps under the Commodity Exchange Act.
The filing states that event contracts qualify as swaps because they are agreements or transactions whose value depends on the occurrence or non-occurrence of future events with potential financial, economic or commercial consequences.
The regulator said the contracts tied to Google’s “Year in Search” rankings fell within that framework because the rankings themselves carried commercial significance tied to Google’s advertising business and search platform.
The complaint further alleges that the confidential information accessed by Spagnuolo was material because it would affect or tend to affect the prices of the related event contracts traded on Polymarket.
Parallel criminal charges unsealed
The CFTC said the U.S. Attorney’s Office for the Southern District of New York separately unsealed parallel criminal charges against Spagnuolo on Wednesday alleging conduct similar to that described in the civil complaint.
The agency said it appreciated the assistance of federal prosecutors in the investigation.
The case adds to regulatory scrutiny of prediction markets and blockchain-based event contracts in the United States, particularly as regulators examine market integrity risks, insider trading concerns and the legal classification of event-based trading products.
