TLDR
- Michele Spagnuolo, a Google software engineer, was charged with insider trading, wire fraud, and money laundering
- He allegedly used confidential Google “Year in Search” data to place winning bets on Polymarket under the alias “AlphaRaccoon”
- He risked $2.75 million across 23+ contracts, earning $1.2 million in profit
- The case is the second major insider trading case linked to Polymarket in 2026
- Google confirmed it assisted federal investigators and has placed Spagnuolo on administrative leave
A Google software engineer has been charged by federal prosecutors with using confidential company data to profit over $1.2 million on the prediction market platform Polymarket.
Michele Spagnuolo, 36, an Italian citizen living in Switzerland, was arrested on Wednesday. The U.S. Attorney’s Office for the Southern District of New York unsealed criminal charges against him, including commodities fraud, wire fraud, and money laundering. The Commodity Futures Trading Commission also filed a separate civil complaint.
Spagnuolo worked as a software engineer at Google. His role gave him access to internal tools containing non-public data from Google’s annual “Year in Search” list — a ranking of the most-searched people and topics of the year.
Google labels this data as confidential. The company treats it as commercially sensitive because the rankings affect advertising, media coverage, and user traffic on its search platform.
How the Alleged Scheme Worked
Between October and December 2025, Spagnuolo allegedly used this inside data to place bets on Polymarket contracts predicting who would top Google’s most-searched list. He operated under the username “AlphaRaccoon.”
He risked approximately $2.75 million across at least 23 contracts. The trades generated around $1.2 million in profit.
Some of his positions were in outcomes the market considered nearly impossible. Prosecutors say the FBI found that a contract on musician D4vd becoming the most-searched person had a “near-zero probability” in the eyes of other traders. Spagnuolo bet on it anyway — and won.
Other trades included positions against Bianca Censori and Pope Leo XIV reaching the top spot. He also held profitable positions in markets tied to Donald Trump, Kendrick Lamar, Jimmy Kimmel, Luigi Mangione, and Tyler Robinson.
The Account Was Already Being Watched
The “AlphaRaccoon” account attracted attention in prediction market communities before any charges were filed. Crypto tracking account Polywhaler says it flagged the trader six months earlier due to an unusually high win rate.
The account reportedly posted a 100% win rate on resolved trades and earned over $1.3 million in profit.
After Spagnuolo’s arrest, Polymarket posted on X saying its market integrity infrastructure had flagged the trader before the arrest.
Once the winnings were transferred out of Polymarket into a private crypto wallet, the AlphaRaccoon username was deleted from the account.
Google confirmed it cooperated with federal law enforcement. The company said that while Spagnuolo used standard internal tools available to many employees, using that data for personal financial gain violated company policy. He has been placed on leave.
U.S. Attorney Jay Clayton said the charges send a clear message: “Corporate insiders cannot use confidential business information to turn a profit in our markets.”
This is the second insider trading case linked to Polymarket in 2026. Earlier this year, a U.S. Army Special Forces soldier was charged with using classified military intelligence about Venezuelan President Nicolás Maduro to profit over $400,000 on the platform.
Spagnuolo has not responded to requests for comment. The allegations against him remain charges, and he has not been convicted of any offense.
