United States: Polymarket being investigated by criminal and civil authorities, a source told on Thursday, before the US Presidential election, called attention to the wagering site.
Polymarket has attracted attention for leaning heavily in favor of Donald Trump in the Nov. 5 election.
The source, however, disclosed that the scrutiny started a few months before the conduct of the election. It was not apparent, however, whether the probes would be complete and what kind of probes they would be. The betting platform has failed to get accreditation from the Commodity Futures Trading Commission, while in the past, the Civil Regulator had sued the platform, and the case was settled in 2022, as reported by Reuters.
Federal Raids and Legal Concerns
Neither Polymarket responded to it or requested further information about the case. The US Attorney’s Office in Manhattan has not commented on this case and the request for this statement as a spokesman was refused.
On Wednesday, federal law enforcement agents raided Coplan’s residence in downtown Manhattan and took his phone and other electronics, Polymarket stated on Wednesday.
Until the day before the vote, Polymarket had set the probability of Republican Trump at extremely high and far beyond Democratic candidate Kamala Harris, defying the polls.
Allegations of Political Retribution
A company spokesperson said on Wednesday: “This is obvious political retribution by the outgoing administration against Polymarket for providing a market that correctly called the 2024 presidential election.”
Bloomberg published on Wednesday that the site was under investigation for policy rumors that enabled U.S.-based users to gamble on the platform. On Thursday, the New York Times covered the FBI home search, saying that it was part of a crime investigation.
In another development, Polymarket in the period previous to the election stated that it does not permit people in the United States to wager on the America’s election via Polymarket, further indicating that it verifies all its major trades to ensure that they are not logging into Polymarket from a VPN to conceal which country they are in.
Americans have had severe limitations placed on betting on the US elections online. CFTC has, in the past, declined applications to provide contracts or derivatives that enable Americans to wager on the elections.
Broader Debate Over Election Betting
In November 2023, another betting exchange, Kalshi, sued the CFTC for its prohibition of betting on the US elections. A federal appeals court supported Kalshi on Oct 2, and thus, Americans got permission to trade on the political races on Kalshi before the election months, as reported by Reuters.
The CFTC, however, did not comment on Thursday.