Published on: May 12, 2026, at 01:37h.
Updated on: May 12, 2026, at 01:37h.
- Representative Pappas urges Oversight Chair Comer to investigate insider trading in prediction markets
- Calls for subpoenas to obtain operators’ internal data
- Reports multiple “suspicious” trades linked to the conflict in Iran
A New Hampshire Democrat is urging the House Oversight Committee to investigate insider trading within prediction markets, specifically asking the committee to subpoena internal documentation from the operators.
In correspondence addressed to House Oversight Chairman James Comer (R-KY), Rep. Chris Pappas (D-NH) highlights “numerous suspicious trades connected to military operations between the U.S. and Israel against Iran,” pointing out one trader who gained $1 million with a 93% success rate on event contracts associated with the Iran conflict.
A separate collective of 38 accounts garnered over $2 million from the strikes on February 28 alone, having been loaded with funds the week prior. Notably, at least 50 newly created accounts placed coordinated bets just minutes before the announcement of a U.S.-Iran ceasefire on April 7,” Pappas remarked.
Some critics, including U.S. politicians, contend that Polymarket, which is not operational within this country, is a hub for shady trades regarding the Iran situation.
Polymarket Working to Enhance Insider Trading Safeguards
Scrutiny has surrounded Polymarket regarding insider trading, particularly from Pappas, who claims the prediction market provider has not deployed adequate measures to prevent trading based on nonpublic information. The congressman, a candidate for the 2026 U.S. Senate seat, stated that Polymarket’s inaction “raises significant concerns regarding its overall compliance with federal legislation.”
Recently, a U.S. special forces member was arrested for insider trades linked to Polymarket concerning the U.S. intervention in Venezuela that led to the capture of dictator Nicolas Maduro. Last month, Polymarket flagged suspicious actions spanning nearly 50 accounts ahead of U.S.-Iran ceasefire discussions.
“The American populace has a legitimate right to understand if individuals entrusted with classified national security information have exploited that access for personal gain,” Pappas wrote in his letter to Comer. “A committee inquiry, enforced through subpoenas, will entail internal records, which are the sole means to identify the individuals behind these trades and ascertain whether these platforms are fulfilling their obligations.”
Highlighting national security issues and potential corruption within prediction markets, Pappas urged Comer for a response by May 22.
Pappas Asserts Congress’s Authority to Investigate Prediction Markets
Despite skepticism regarding the industry’s ability to mitigate insider trading, Pappas believes that Congress has the capability to uncover potential illegal activities within prediction markets.
“Congress possesses both the authority and responsibility to ascertain whether existing ethics, classification, and financial disclosure regulations have been infringed upon, and whether legislative measures are needed to avert future occurrences,” he expressed to Comer. “We cannot fulfill that duty without identifying who executed these trades.”
His viewpoint holds weight, given that the Commodity Futures Trading Commission (CFTC), the federal body overseeing prediction markets, operates on funding allocated through congressional appropriations.