Polymarket Probes Dozens of Election Bets and Refers Cases to CFTC

Prediction market operator Polymarket has investigated dozens of wagers placed on its midterm election markets for suspected manipulation and insider trading, according to statements made by head of global intelligence Shana Bautista to NPR ¹. A person familiar with the inquiries stated that at least two matters have been forwarded to the Commodity Futures Trading Commission (CFTC) ¹.

Bautista, a former FBI official who joined the firm in June, leads a 16-member team monitoring both the identity-verified U.S. exchange and Polymarket International, which permits cryptocurrency deposits ¹. The exchange's surveillance infrastructure processes information from Federal Election Commission (FEC) records, banking partners, social networks, and statistical models, generating hundreds of automated alerts each day ahead of the Nov. 3 vote ¹. Bautista emphasized that crypto transactions are rarely completely untraceable, stating that internal tools have regularly identified individuals behind anomalous wagers ¹.

Heightened Scrutiny on Political Trading

Trading integrity on political event platforms has drawn increasing focus from lawmakers and federal agencies amid a broader prediction market volume surge ahead of the midterms ¹. Competitor Kalshi previously introduced an FEC-linked screening tool in May to prohibit campaign employees from betting, alongside employment disclosure rules added in June ¹. Kalshi reported opening upwards of 150 internal investigations and making more than 20 referrals to law enforcement this year, though an anonymous campaign staffer claimed to have bypassed the restrictions ¹.

Concerns regarding non-public information emerged earlier in the election cycle when campaign workers acknowledged profiting off early polling data, while a U.S. Army service member was separately indicted in April for betting on Polymarket using classified military intelligence ¹. Although the CFTC has largely relied on platform self-policing, agency staff issued guidance in September cautioning that event contracts tied to specific mentions or appearances are presumed vulnerable to illicit manipulation ¹.