A 12-year veteran Google information security engineer has been arrested and charged with breaking U.S. insider trading laws, accused of exploiting confidential internal company data to place high-yield bets on the blockchain-based prediction platform Polymarket and net more than $1 million in illegal profits. Prosecutors from the U.S. Attorney’s Office for the Southern District of New York announced the charges against Michele Spagnuolo, an Italian citizen residing in Switzerland, who was taken into custody this week and appeared before a New York federal magistrate following his arrest.
Court documents outline a scheme that began in 2024, when Spagnuolo started placing bets tied directly to unannounced Google outcomes on Polymarket, a prediction market that exclusively accepts cryptocurrency and operates on transparent blockchain infrastructure. Between October and December 2024, prosecutors allege Spagnuolo wagered a total of $2.7 million on Google-related events, leveraging early access to internal company data he obtained through his employment at the U.S.-based tech giant. His largest single win came from a high-risk bet on the 2025 Google Year in Search results, which had not yet been made public. Prosecutors say Spagnuolo correctly predicted the final rankings of the platform’s most-searched person category: he bet against high-profile candidates including Bianca Censori and former President Donald Trump, and placed a large wager on little-known musician D4vd to claim the top spot at odds that were near zero. At the time he placed the bet in November, Spagnuolo already knew D4vd held the top ranking because he had accessed the internal search data weeks before its public release. D4vd, the musician in question, is currently incarcerated facing charges for the alleged murder of a teenage girl.
The investigation, a joint effort between the U.S. Attorney’s Office and the Federal Bureau of Investigation, was able to trace the illegal activity back to Spagnuolo despite his attempts to conceal his identity. He operated under the account name AlphaRaccoon and spread his funds across multiple cryptocurrency wallets, but investigators linked the account to him after finding one wallet registered with his Italian national identification card. Following his arrest, Spagnuolo was released on a $2.25 million bond, and has not yet responded to requests for comment on the charges against him.
Google confirmed Wednesday that the engineer has been placed on administrative leave, and that the company is cooperating fully with law enforcement’s ongoing investigation. A company spokesperson noted that the confidential marketing data Spagnuolo is accused of accessing was available through a tool accessible to all Google employees, but that using private internal information for personal financial gain constitutes a severe violation of the company’s internal policies.
Polymarket also confirmed that it has collaborated closely with authorities throughout the investigation, pointing to the inherent transparency of blockchain-based trading as a key factor that helped investigators trace the illegal activity. “Blockchain trading is transparent, traceable, and bad actors leave footprints,” a Polymarket spokesperson said. The case marks one of the first high-profile insider trading prosecutions tied to prediction markets, highlighting growing regulatory scrutiny of unregulated crypto-based platforms that facilitate trading on real-world events.