US Regulator Confirmed to Have Opened Three Unreported Probes Into Polymarket Trading
Documents obtained by WIRED via a Freedom of Information Act request reveal that the CFTC quietly opened three previously unknown investigations into suspicious trading on Polymarket.
Records obtained by WIRED through a Freedom of Information Act request show that the Commodity Futures Trading Commission, the agency overseeing US prediction markets, has opened three investigations into Polymarket trading that had not previously come to light.
In early May, CFTC chairman Michael Selig signed off on an order letting the agency's enforcement division investigate possible insider trading tied to pardons granted by former president Joe Biden. The order authorized subpoenas, sworn testimony, and demands for documents, though it did not name specific trades under scrutiny. It followed an NPR report about a trader who made over $300,000 correctly betting that Biden would issue preemptive pardons to prominent critics of Donald Trump, including former lawmakers Liz Cheney and Adam Kinzinger and senator Adam Schiff.
A second order, approved by Selig at the end of May, targeted contracts related to Iran. That probe came roughly two weeks after a 60 Minutes segment exposed a group of accounts that earned $2.4 million on Iran-related bets with a 98 percent success rate. A former CFTC enforcement attorney, Joseph Konizeski, warned that launching probes mainly in response to media coverage points to weaknesses in the regulatory approach.
In July, a third order authorized an investigation into suspected insider trading on Google-related contracts, specifically concerning individuals who may have exploited information about Google's 2025 Year in Search rankings. CFTC enforcement official Paul Hayeck noted this case is distinct from the existing prosecution of Google engineer Michele Spagnuolo, and that federal prosecutors in the Southern District of New York are running a parallel inquiry.
Polymarket's Olivia Chalos said the company cooperates with law enforcement referrals. Google and the CFTC declined to comment or did not respond to WIRED's questions. The CFTC has separately investigated rival platform Kalshi, which has referred over 30 cases to regulators, including one involving former congressman George Santos, who was fined for manipulating a contract tied to his attendance at Trump's State of the Union address.
Two arrests have resulted from Polymarket-related insider trading investigations so far: a US special forces officer accused of profiting off classified information about the capture of Venezuela's Nicolás Maduro, and Spagnuolo, accused of making over $1.2 million from insider trades. Both face civil and criminal charges, and both argue Polymarket contracts constitute betting rather than regulated commodities trading. It remains unclear whether the Justice Department has opened parallel probes into the Iran or Biden pardon markets.
