The US justice department has charged a Google software engineer with using insider information to rig bets tied to Google’s most-searched list on the prediction market Polymarket , earning $1.2m in profits, according to a complaint unsealed on Wednesday.

Michele Spagnuolo, a 36-year-old Italian citizen, allegedly used insider information to bet on long-shot candidates and reap immense financial gain. His arrest comes one month after prosecutors charged a US army soldier with using classified information to place Polymarket bets about military action in Venezuela.

The charges against Spagnuolo are part of a broader boom in the use and misuse of prediction markets, which have grown into a multibillion-dollar industry in recent years.…