Federal authorities don arrest one special operations soldier wey help catch Venezuelan President Nicolas Maduro, because e allegedly use inside information to bet more than $400,000 say Maduro go soon comot from office. The Justice Department announce the arrest on Thursday.
The soldier wey dem dey call Gannon Ken Van Dyke, e bet more than $33,000 on Polymarket, one prediction market platform, just days before President Donald Trump announce say dem don capture Maduro. The series of bets, wey bring am more than $409,000, immediately make people begin suspect say inside information dey involved, and e lead to months of investigation.
Van Dyke don face charges wey include unlawful use of confidential information for personal gain, theft of nonpublic government information, commodities fraud, and wire fraud. According to the indictment, when Van Dyke see reports about unusual trading wey concern the mission, e try to delete im Polymarket account and change the email address wey dey registered to im cryptocurrency exchange account, to hide the evidence.
The indictment say, “Rather than safeguard that information as he was obligated to do, Van Dyke decided to use that classified information to place trades on a prediction market platform for his personal profit.” E still try to obscure the source of im unlawful proceeds and disguise im connection to the accounts wey dey linked to the illicit trades.
E no clear if Van Dyke get lawyer wey dey represent am. Days before Trump announce say Maduro don capture during “Operation Absolute Resolve,” Van Dyke place series of bets on Polymarket, including whether Maduro go comot from office by January 20, 2025. The largest bet na $32,537 wey e bet say Maduro go leave office by that date.
While the indictment no go into detail about Van Dyke role for the raid, prosecutors note say e dey photograph on the deck of USS Iwo Jima, the ship wey dem move Maduro to after im capture, wearing military fatigues and holding rifle alongside other service members.
Polymarket spokesperson say the company refer the suspicious bets to Department of Justice and cooperate with the investigation. Dem post statement on X wey say, “Insider trading has no place on Polymarket. Today’s arrest is proof the system works.”
The arrest and indictment believe to be the first time Department of Justice dey prosecute case of insider trading for prediction market. Polymarket, wey be the world largest prediction platform, allow traders to anonymously bet on future events using event contracts based on yes or no questions. While prediction markets dey primarily regulated by Commodity Futures Trading Commission, suspiciously-timed trades on platforms like Kalshi and Polymarket don spark concerns about insider trading.
When dem ask Trump for Oval Office about Van Dyke wagers, e say, “That’s like Pete Rose betting on his own team. Pete Rose, they kept him out of the Hall of Fame because he bet on his own team. Now, if he bet against his team, that would be no good, but he bet on his own team. I’ll look into it.” Trump also talk about concerns say federal employees dey make insider trading bets on Iran conflict and other developments, e say “the whole world, unfortunately, has become somewhat of a casino. I was never much in favor of it. I don’t like it conceptually, but it is what it is.”
Former U.S. Attorney for Southern District of New York Jay Clayton confirm say prosecutors dey actively look at ways to potentially prosecute individuals wey dey try to game the system through manipulating prediction markets. E tell CNBC say, “My prosecutors are busy looking at what laws we can use that are like insider trading laws.”
Noah Solowiejczyk, partner at law firm Fenwick & West and former federal prosecutor for Manhattan, say while prediction markets relatively new, prosecutors fit apply decades-old statute to bring insider trading case. E say, “The Commodities Exchange Act deals with a situation like this. There’s a particular provision.” But e note say prosecutors need to plan for “learning curve” for jury to understand how prediction markets work, and say “a major undertaking for the government would be distilling and simplifying what happened so that the jury can understand it.”
In February, one Israeli army reservist and civilian don charge for Israel for using classified information to place bets on Polymarket.
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