"From on or about December 4, 2025 through on or about December 10, 2025...the software released approximately 3,914,362 million USDC.e to the AlphaRaccoon Polymarket account."
Michele Spagnuolo charged in the Southern District of New York
Federal prosecutors in the Southern District of New York have charged 36‑year‑old Michele Spagnuolo, an Italian citizen residing in Switzerland and a Google employee since 2014, with insider trading tied to bets placed on a cryptocurrency-based decentralized prediction market. Spagnuolo appeared in court on Wednesday after being indicted under counts that include commodities fraud, wire fraud, and money laundering. According to the filing, he faces a maximum sentence of 10 years on the commodities fraud count and 20 years each on the wire fraud and money laundering counts.
Alleged use of Google's internal "Year in Search" data to inform Polymarket bets
The criminal complaint alleges Spagnuolo used an internal Google software tool that contained confidential “Year in Search” data — Google's annual ranking of top trending search terms — and that the tool was marked with a “Google Confidential” banner in red text. Beginning in October 2025, prosecutors say, Spagnuolo operated a Polymarket account under the alias "AlphaRaccoon" to bet on whether specific individuals would appear on Google's top trending search lists. The complaint describes approximately 25 unlikely outcomes on which Spagnuolo placed bets with near‑perfect accuracy, risking roughly $2.75 million in total.
Winnings, on‑chain transfers, and an odd accounting line in the complaint
After Google publicly announced its Year in Search results on December 4, 2025, the complaint states the AlphaRaccoon Polymarket account collected approximately $1.2 million in USDC.e winnings. The complaint also records a transaction narrative: “From on or about December 4, 2025 through on or about December 10, 2025, when the Polymarket markets regarding Google's Year in Search resolved, the software released approximately 3,914,362 million USDC.e to the AlphaRaccoon Polymarket account. On or about December 10, 2025, the AlphaRaccoon Polymarket account sent approximately 5.045 million USDC.e, to Wallet-0xAf6.”
Blockchain tracing, public speculation, and efforts to obscure proceeds
Investigators from the FBI traced the AlphaRaccoon account to a payment processor account registered in Spagnuolo's name and linked to an Italian government identification card, the complaint says. As online communities on Discord and X began speculating that AlphaRaccoon was a Google insider, the username was removed and the account reverted to an alphanumeric wallet address. Prosecutors further allege that Spagnuolo moved the proceeds through multiple cryptocurrency‑swapping services, including at least one service designed to remove wallet addresses from the blockchain.
CFTC civil action and public statements from enforcement officials
On the same day as the criminal charges, the Commodity Futures Trading Commission filed a separate civil complaint seeking restitution, disgorgement, civil monetary penalties, and trading and registration bans. U.S. Attorney Jay Clayton was quoted saying, “Today's charges reinforce a decades-old message: corporate insiders cannot use confidential business information to turn a profit in our markets. As alleged, Spagnuolo violated the duties he owed to his employer and used Google's confidential business information to make more than $1.2 million in trading profits on Polymarket.” CFTC Director of Enforcement David I. Miller added, “Employees who are entrusted with confidential business information cannot misappropriate that information for personal financial gain.”
What this means for technologists, regulators, and decentralized markets
- Technologists and security teams: The complaint highlights how labeled, internal datasets — here, a “Google Confidential” Year in Search tool — can be the source of illicit trading if access controls and monitoring fail. Organizations will watch how access to trending or outcome‑predictive datasets is audited.
- Regulators and prosecutors: The case shows parallel criminal and civil avenues — a DOJ prosecution in the Southern District of New York and a CFTC civil complaint — being used in tandem to seek prison sentences, financial restitution, and market bans.
- Decentralized markets and exchanges: Polymarket, described in the complaint as a cryptocurrency‑based decentralized prediction market, was the venue for the alleged insider bets; the matter raises questions about how decentralized platforms detect and respond to trading informed by confidential, off‑chain information.
The indictment and the companion CFTC complaint together place both criminal penalties and civil remedies on the table: restitution, disgorgement, monetary penalties, trading and registration bans, and multi‑year prison terms. The record in the filings shows law enforcement tracing activity from on‑platform aliases to payment processor accounts tied to government identification and documents multiple on‑chain moves and attempted obfuscation. The criminal case and civil proceedings will determine whether the allegations about misuse of Google's Year in Search data and the related money flows meet the standards for conviction and civil relief.
