Insider trading and market integrity
Federal prosecutors have brought criminal charges, and the CFTC has sued and settled, over event-contract trades made on non-public information. Here is every case, every federal enforcement step and every bill in Congress to restrict who can trade.
- 2Criminal prosecutions
- 4CFTC cases and settlements
- 21Integrity bills in Congress
- 1Adopted or passed a chamber
Cases
- CFTC settlement with Gabriel Perez (presidential mention contracts)
The CFTC filed and settled insider-trading charges against Gabriel Perez on Aug. 28, 2026. It found that between December 2025 and March 2026, while working as a White House teleprompter operator with advance access to presidential speeches, he traded Kalshi contracts that settle on words the President uses, misusing material nonpublic information in breach of a duty of trust and confidence. The order cites CEA Sections 4c(a)(3), 4c(a)(4)(C) and 6(c)(1) and Regulation 180.1. Without admitting or denying the findings, he agreed to pay about $172,000, with the penalty reduced for cooperation, and to a three-year trading ban.
Filed Aug. 28, 2026 · CFTC Docket No. 26-06 · Kalshi
- CFTC settlement with George Santos (State of the Union contract)
The CFTC filed and settled charges against former Congressman George Santos on July 31, 2026. The agency found that between Feb. 12, 2026 and Feb. 25, 2026 he manipulated a Kalshi contract on whether he would attend the 2026 State of the Union, an outcome he controlled, by posting misleading statements on social media about his plans, in violation of CEA Section 6(c)(1) and Regulation 180.1. Without admitting or denying the findings, he agreed to pay about $35,000 in disgorgement and penalties, to a three-year trading ban and to cease and desist.
Filed July 31, 2026 · CFTC Docket No. 26-05 · Kalshi
- United States v. Spagnuolo (Google search-data Polymarket trades)
Federal prosecutors in Manhattan charged Michele Spagnuolo, a Google software engineer living in Switzerland, in a criminal complaint unsealed on May 27, 2026. The government alleges that from about October to early December 2025 he used confidential Google data from an internal tool to trade Polymarket contracts on Google's Year in Search rankings under the handle AlphaRaccoon, risking about $2.75 million and making about $1.2 million. He faces one count each of commodities fraud, wire fraud and money laundering. These are allegations. The CFTC filed a parallel civil suit.
Filed May 27, 2026 · Polymarket
- CFTC v. Spagnuolo (civil insider-trading suit)
The CFTC sued Google software engineer Michele Spagnuolo in federal court in Manhattan on May 27, 2026, alleging that he traded at least 23 Polymarket contracts on Google's 2025 Year in Search results using confidential information he obtained through his job, for about $1.2 million in profit. It seeks restitution, disgorgement, penalties, trading bans and an injunction. These are allegations. A parallel criminal case is pending in the same court.
Filed May 27, 2026 · 1:26-cv-04419 · Polymarket
- United States v. Van Dyke (Maduro-raid Polymarket trades)
Federal prosecutors in Manhattan unsealed a five-count indictment against Gannon Ken Van Dyke, an active-duty Army soldier based at Fort Bragg, on April 23, 2026. The government alleges he used classified information about the U.S. operation to capture Nicolas Maduro to bet about $33,000 on a Polymarket contract on Maduro's exit, making roughly $410,000. He is charged with three Commodity Exchange Act counts, wire fraud and an unlawful monetary transaction; he has pleaded not guilty and these remain allegations. The CFTC filed a parallel civil suit, which has been stayed while the criminal case proceeds. Van Dyke has moved to dismiss, arguing among other things that the contracts are not swaps.
Filed April 23, 2026 · 1:26-cr-00156 (26 Cr. 156) · Polymarket
- CFTC v. Van Dyke (civil insider-trading suit over Maduro-raid trades)
The CFTC sued Army service member Gannon Ken Van Dyke in federal court in Manhattan on April 23, 2026, the day his criminal indictment was unsealed. It alleges that he used nonpublic information about the operation to capture Nicolas Maduro, gained through his role in it, to buy more than 436,000 Yes shares in a Polymarket contract on Maduro leaving office by Jan. 31, 2026, making more than $404,000. The agency seeks restitution, disgorgement, penalties, trading bans and an injunction. These are allegations. The civil case was stayed in August 2026 pending the criminal case.
Filed April 23, 2026 · 1:26-cv-03369 · Polymarket
Federal enforcement steps
CFTC settles insider-trading case over presidential mention markets
A former White House teleprompter operator, Gabriel Perez, agreed to pay about $172,000 and accept a three-year trading ban to settle charges that he traded presidential mention contracts using advance access to speeches.
Source: CFTC Release 9289-26
CFTC uses emergency authority to keep Kalshi operating
New York's Attorney General sued KalshiEX in state court on July 31, seeking to bar its event contracts and over $36 billion in damages. The CFTC then acted on Kalshi's notice of a market emergency and ordered the exchange to keep operating under the CEA Core Principles.
Source: CFTC Release 9281-26
CFTC settles manipulation charges with George Santos
Former Rep. George Santos agreed to pay about $35,000 and accept a three-year trading ban to settle charges that he manipulated a contract on whether he would attend the State of the Union, an outcome he controlled.
Source: CFTC Release 9276-26
CFTC emergency order makes Kalshi fulfill Michigan trades
After a Michigan state court ordered Kalshi to cancel executed trades, the CFTC stayed Kalshi's emergency rule change and used its emergency authority to order the open trades fulfilled under Kalshi's normal practices.
Source: CFTC Release 9267-26
Google engineer charged over Polymarket search-ranking trades
SDNY unsealed a criminal complaint and the CFTC filed parallel civil charges against Google engineer Michele Spagnuolo. Both allege he used nonpublic Year in Search data to trade at least 23 Polymarket contracts, for about $1.2 million in profit.
Source: CFTC Release 9237-26
Army service member indicted over Maduro-related Polymarket trades
SDNY prosecutors indicted Gannon Ken Van Dyke, and the CFTC filed a parallel civil case. Both allege he used nonpublic information about the operation to capture Nicolas Maduro to trade a Polymarket contract, making over $404,000.
Source: CFTC Release 9217-26
Enforcement Director names prediction-market insider trading a priority
CFTC Director of Enforcement David Miller named insider trading in prediction markets as one of the division's priorities for 2026.
CFTC Enforcement Division issues prediction-markets advisory
The Division of Enforcement said the Commission can pursue insider trading, wash trading, manipulation and fraud on any DCM. It cited two 2025 Kalshi disciplinary cases: a candidate who traded on his own race and a YouTube channel editor.
Source: CFTC Release 9185-26
SDNY U.S. Attorney signals scrutiny of prediction markets
Bloomberg reported that the U.S. Attorney for the Southern District of New York said his office was examining prediction-market conduct under federal fraud statutes.
Source: K&L Gates 2026 Mid-Year Prediction Market Report (citing Bloomberg)