REGULATION | A Google Engineer Becomes Latest Arrest for Insider Trading

A Google engineer has been charged by U.S. prosecutors for allegedly using confidential search trend data to make more than $1 million trading on the Polymarket prediction markets tied to Google’s annual ‘Year in Search’ rankings, marking one of the highest-profile insider trading cases yet involving crypto-based event markets.

Federal prosecutors in Manhattan said Michele Spagnuolo, a Google security engineer based in Switzerland, used nonpublic internal search data to place highly accurate wagers on which celebrities and public figures would dominate Google search rankings in 2025. The bets were allegedly placed on Polymarket under the pseudonym ‘AlphaRaccoon,’ according to unsealed court filings.

Authorities allege Spagnuolo generated roughly $1.2 million in profits after deploying about $2.7 million across dozens of trades between October and December 2025. Prosecutors said the engineer exploited privileged access to internal Google analytics tools before the company publicly released its year-end search data.

The complaint includes allegations that Spagnuolo accurately predicted surprise search surges tied to musicians and viral news events, including independent artist, D4vd. Investigators said the timing and precision of the wagers raised immediate suspicions among market participants with online crypto communities previously speculating that a trader had access to leaked Google data months before the arrest.

Spagnuolo faces charges including

• commodities fraud,
• wire fraud, and
• money laundering.

Google said the employee has been placed on leave and that the company is cooperating with authorities. Prosecutors described the case as a warning shot for insider trading in emerging prediction markets where regulators have increasingly scrutinized the use of privileged information.

The case adds to mounting pressure on prediction market operators as regulators and lawmakers debate whether platforms built around event-based wagering should face the same market abuse rules applied to traditional finance. It also marks the second major insider-trading-related arrest tied to prediction markets in 2026.

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