Staff working on political campaigns are using data they receive from polls to wager on prediction markets and win thousands of dollars.
As part of their roles, the staff receive poll data before it becomes public. When published, the polls move the odds on prediction market platforms such as Polymarket. The staff place trades before the poll is released and then cash out when the price moves.
An anonymous worker from a statewide campaign in the South told NPR they have followed this blueprint to generate thousands of dollars in profits.
In one example, a new poll showed one candidate in a commanding lead, but the campaign staff doubted its accuracy. Nevertheless, they knew that when it became public, the lines on the candidate to win the election would move significantly on prediction market platforms.
“Myself and others started placing bets before that poll came out,” the staffer revealed. “And then, sure enough as soon as that poll came out, the stock went up and everybody made money.”
Individually, the worker said they had made thousands of dollars of profit trading on just one market.
Foolish Not to Profit From Insider Info, Admit Staff
“Because you have all this information and knowledge that isn’t publicly available yet, it’s almost foolish not to bet on it before it’s made public,” the staffer said.
If caught, however, they could face sanctions from the prediction market platforms where they traded, as well as possible criminal prosecution.
The rules remain unclear about what constitutes insider trading, but lawmakers are increasingly seeking firmer guidelines to prevent more scandals.
The US Senate recently passed a rule prohibiting Senators from trading on prediction markets, but that does not yet extend to campaign staff. There are also calls on the Commodity Futures Trading Commission (CFTC) to take a stronger stance.
Rep. Ritchie Torres has said he plans to introduce legislation to tighten rules on campaign insiders trading in political prediction markets.
The Battle Against Insider Trading
The campaign staff admitted they traded on Polymarket and another prediction market platform, PredictIt. Following a series of scandals, Kalshi and Polymarket updated their insider trading guidelines in March.
Polymarket announced that it now prohibits users who can influence an event’s outcome from trading on those markets. Additionally, it said it prohibits trading on stolen confidential information and trading on illegal tips.
The company further defined trading on stolen confidential information, stating that “participants may not trade on any contract if they possess confidential information about the outcome or likely outcome of the underlying event, where using that information would violate a preexisting duty or obligation of trust or confidence owed to another person or entity.”
Was This Insider Trading?
Regarding the political campaign staff, it is unclear whether they have been explicitly told not to trade on prediction markets.
If an individual trades on privileged information and has a duty not to disclose or misuse it, that constitutes insider trading in the eyes of the CFTC, the organization’s former regulator, Carl Kennedy told CasinoBeats.
Kennedy also emphasized that “If you are a registered exchange … one of your roles is also to be a regulator deputized by the CFTC to police your own market.”
Polymarket assisted in the arrest of US soldier Gannon Van Dyke for wagering on the capture of Nicolas Maduro, an operation in which he was personally involved. However, the platform continues to promote trading on wars and conflicts, despite these being explicitly prohibited by the CFTC’s rules.
We reached out to the company to ask whether the campaign staffers trading on elections violates the platform’s rules, but it did not respond.
Another former CFTC worker, Jeff Le Riche, said the campaign staff’s employment documents would define whether their trades fell foul of the organization’s rules.
“There’s probably a pretty good argument that they’re using information that they’re not supposed to use for their benefit,” Le Riche said.
The case demonstrates the difficulty of policing those who trade on prediction markets and is likely to strengthen the argument that election betting should not be allowed in the first place.
The post Campaign Staffers Use Insider Poll Data to Make Huge Profits on Prediction Markets appeared first on CasinoBeats.
Staff working on political campaigns are using data they receive from polls to wager on prediction markets and win thousands of dollars. As part of their roles, the staff receive poll data before it becomes public. When published, the polls move the odds on prediction market platforms such as Polymarket. The staff place trades before
The post Campaign Staffers Use Insider Poll Data to Make Huge Profits on Prediction Markets appeared first on CasinoBeats.