Lynnae Williams Journalist
Lynnae is a journalist covering the intersection of technology, culture, and gambling. She has more than five years of experience as a writer and editor, with bylines at SlashGear and MakeUseOf. On the iGaming side,...
Read Full BioAn Israeli military reservist and a civilian have been indicted for allegedly using classified information to place wagers on Polymarket about the timing of the country’s military operations.
In a statement on February 12, Israeli police said multiple suspects had been arrested, including reservists and a civilian, on suspicion of betting on Polymarket using information the service members were exposed to because of their positions in the army.
Prosecutors decided to pursue a criminal case against the reservist and civilian after investigators found sufficient evidence of “serious security offenses” as well as bribery and obstruction of justice.
Authorities stressed that the activity the suspects engaged in posed a real security risk to Israel Defense Forces (IDF) operations and state security.
“The defense establishment emphasizes that placing such bets, based on secret and classified information, poses a real security risk to IDF operations and to the security of the state,” the joint statement said, adding that authorities view “the acts attributed to the defendants with utmost severity and will act decisively to thwart and bring to justice anyone involved in the unlawful use of classified information.”
According to The Times of Israel, while the IDF confirmed that “no operational harm was caused” in this specific instance, the breach was labeled a “severe ethical failure” that crossed a “clear red line.”
High-Stakes Wagers Linked to Classified Operations
The joint investigation, carried out by the Director of Security of the Defense Establishment, the Shin Bet domestic security agency, and the Israel Police, was triggered by reports of unusually well-timed betting patterns on Polymarket.
While the authorities didn’t specify which Polymarket contracts were involved, when news of the investigation broke in late January, reports pointed to a Polymarket trader operating under the pseudonym “ricosuave666,” who had placed a series of successful bets that correctly predicted the timing and nature of Israeli strikes against Iran during the “12-day war” in June 2025.
These wagers, totaling tens of thousands of dollars, focused on specific outcomes, including:
- The exact Friday the military action would commence.
- The conclusion of operations before the end of June 2025.
- The official government signals that the campaign will end by July.
The account reportedly netted more than $150,000. Israel’s security establishment has not yet revealed the identities of the individuals indicted because they remain subject to a court-issued gag order. The state has requested that the suspects remain in detention until the court case is over.
Global Scrutiny of Insider Trading in Prediction Markets
Prediction markets have been under scrutiny for insider trading for months, but the Israeli case is the first time suspects have been prosecuted for allegedly using nonpublic information to profit from betting on these platforms.
Critics have long argued that platforms like Polymarket, which allow users to bet on geopolitical events, are especially susceptible to insider trading.
In early January, questions about insider trading on prediction markets picked up steam when several Polymarket traders made a profit after betting on Venezuelan President Nicolás Maduro being removed from office just hours before an operation led by U.S. Special Operations Forces resulted in his capture.
Blockchain analysis showed newly created wallets placed large “Yes” positions on Maduro’s exit just hours before a secret U.S. raid became public. These trades produced a combined payday of more than $600,000.
In a direct response to this incident, U.S. Rep. Ritchie Torres (D-NY) introduced the Public Integrity in Financial Prediction Markets Act of 2026. If passed, the federal bill would make it illegal for government officials to trade contracts on prediction markets if they “possess material nonpublic information” or “may reasonably obtain such material nonpublic information in the course of performing official duties.”
