Technology
Google engineer seeks dismissal of US insider trading charges over Polymarket bets
Defense attorneys argue prediction market wagers do not qualify as regulated financial swaps and fall outside US jurisdiction.
The short version
- Michele Spagnuolo, an on-leave Google engineer, filed a motion to dismiss federal commodities fraud, wire fraud, and money laundering charges.
- US prosecutors allege Spagnuolo used internal Google search data under an alias to profit more than $1.2 million on Polymarket wagers.
- The defense contends the wagers were offshore gambling rather than regulated commodities swaps, and that the US lacks extraterritorial jurisdiction.
- A judge must now determine whether US financial regulations and criminal jurisdiction extend to foreign prediction market activity.
Key facts
- Michele Spagnuolo was arrested by US authorities in May on charges of commodities fraud, wire fraud, and money laundering related to wagers placed on Polymarket.[Slashdot]
- Prosecutors allege Spagnuolo operated under the pseudonym 'AlphaRaccoon' to make over $1.2 million, including bets on Google's most-searched person of the year for 2025.[Slashdot]
- Spagnuolo's defense team filed a motion to dismiss, asserting the bets do not meet the definition of swaps under the US Commodities Exchange Act.[Slashdot]
- The defense also argues the US government lacks jurisdiction because Spagnuolo is a foreign citizen who placed bets from Switzerland on a platform administered by an entity registered in Panama.[Slashdot]
- Google has placed Spagnuolo on leave following the charges.[Slashdot]