A Google software engineer is facing serious federal charges after authorities say he quietly turned inside knowledge of what the world was Googling into about $1.2 million on Polymarket. Prosecutors in Manhattan unsealed a complaint on Wednesday naming 36-year-old Michele Spagnuolo, alleging he placed a series of bets tied to Google activity under the online handle AlphaRaccoon. He is charged with commodities fraud, wire fraud and money laundering.
According to a federal complaint in the Southern District of New York, prosecutors say Spagnuolo "misappropriated confidential and valuable nonpublic information" from an internal Google tool that tracks user searches, then used it to place wagers ahead of Google's Year in Search announcement. They allege he correctly bet that the singer D4vd would be the most searched person of 2025, even though traders on Polymarket had assigned that outcome almost no chance before Google published its list. As reported by WFAE, the complaint lays out the timeline of those trades and the unsealing of the charges in Manhattan.
Prosecutors say the AlphaRaccoon account pushed millions of USDC through multiple crypto wallets, token-swapping services and privacy tools before some of the money surfaced at an Italian payment processor, in an account allegedly opened with identification linked to Spagnuolo. Charging documents say the AlphaRaccoon moniker disappeared from the Polymarket account soon after the winnings were moved. CoinDesk details the blockchain tracing that investigators say allowed them to follow the money and the steps they claim were taken to hide it.
Google says it is working with law enforcement and has placed the employee on leave, calling the use of internal marketing materials to place bets "a serious breach of our policies." The company noted that the tool Spagnuolo allegedly accessed is available to employees, but using it to gamble on the results is not. Those internal rules and Google’s response were outlined in reporting by Axios.
Charges, Bail And The Court Timetable
Prosecutors say Spagnuolo personally cleared roughly $1.2 million from the disputed trades, and they have charged him with commodities fraud, wire fraud and money laundering. Court filings and contemporaneous reporting indicate he was arrested in New York, brought before a magistrate judge for a brief initial appearance and then released on a $2.25 million bond. Bloomberg Law reported the bond amount along with additional early details about the case.
What This Means For Prediction Markets
The indictment lands in the middle of a wider fight over how prediction markets should be policed, and whether crypto-based platforms that sit offshore still fall under U.S. commodities rules. Polymarket’s main platform is technically based in Panama and has been effectively off-limits to American users following earlier enforcement actions, and both the company and its founder have drawn FBI and regulatory attention, according to WFAE. Earlier coverage has also noted that 1789 Capital, the venture firm where Donald Trump Jr. is a partner, invested in Polymarket, and that Trump Jr. later signed on as an adviser to the company, a detail first reported by Axios.
What Prosecutors Will Need To Prove
Legal observers say the government will have to show that Spagnuolo had a legal duty to keep the search-trend data confidential and that he knowingly used it to trade, a standard that has not been fully tested yet in the context of prediction markets. Prosecutors argue that the blockchain trail in this case supplied the roadmap investigators needed, and the prosecution could become an early test of how traditional commodities and wire fraud statutes apply to bets placed on crypto-native exchanges, according to reporting by Bloomberg Law.
