CFTC Brings First Event-Contract Insider Trading Case Over Maduro Bets

NEW YORK - The Commodity Futures Trading Commission and the Justice Department have accused active-duty Army soldier Gannon Ken Van Dyke of using classified information from a U.S. operation targeting Nicolás Maduro to make more than $400,000 on Polymarket event contracts.

The CFTC said its April 23 civil complaint in the U.S. District Court for the Southern District of New York is the agency's first insider-trading case involving event contracts. The Justice Department said a parallel indictment charges Van Dyke with crimes tied to alleged trading on Venezuela and Maduro outcomes while he had access to classified military information.

What Happened

The CFTC said Van Dyke, a North Carolina active-duty Army service member, was involved in planning and executing Operation Absolute Resolve, a U.S. operation to capture Maduro and his wife, Cilia Flores. The agency said its complaint alleges Van Dyke obtained classified, nonpublic information through that role and owed the U.S. government a duty of trust and confidentiality.

According to the CFTC, Van Dyke used the Polymarket handle "Burdensome-Mix" and bought more than 436,000 "Yes" shares of the "Maduro Out by January 31, 2026?" contract between Dec. 30, 2025, and Jan. 2, 2026. The agency said the trades generated more than $404,000 in profits.

The Justice Department said Van Dyke, 38, of Fayetteville, North Carolina, was stationed at Fort Bragg and signed nondisclosure agreements promising not to reveal classified or sensitive information about military operations. Prosecutors said he was involved in Operation Absolute Resolve from around Dec. 8, 2025, through at least Jan. 6, 2026.

According to the Justice Department, Van Dyke created a Polymarket account on or about Dec. 26, funded it and made about 13 bets from Dec. 27 through Jan. 26. Prosecutors said the bets all took the "YES" position on contracts tied to U.S. forces in Venezuela, Maduro leaving power, a possible U.S. invasion of Venezuela and whether President Trump would invoke War Powers against Venezuela by Jan. 31.

The Justice Department said Van Dyke wagered about $33,034 while in possession of classified nonpublic information. Prosecutors said that after the Jan. 3 apprehension of Maduro and Flores in Caracas and the president's public announcement, several Polymarket contracts resolved to "YES" and Van Dyke allegedly made about $409,881.

The Charges

The Justice Department said the indictment charges Van Dyke with unlawful use of confidential government information for personal gain, theft of nonpublic government information, commodities fraud, wire fraud and making an unlawful monetary transaction. Prosecutors said the Commodity Exchange Act counts each carry a maximum sentence of 10 years in prison, the wire-fraud count carries a maximum sentence of 20 years, and the unlawful monetary transaction count carries a maximum sentence of 10 years.

The department said those maximum penalties are set by Congress and that any sentence would be determined by a judge. Van Dyke has been charged, not convicted, and the allegations remain subject to litigation in federal court.

The CFTC said its civil case seeks restitution, disgorgement, civil monetary penalties, trading and registration bans, and a permanent injunction against further Commodity Exchange Act and CFTC rule violations. The Justice Department said the criminal case has been assigned to U.S. District Judge Margaret M. Garnett in Manhattan.

Why The Case Matters

The case turns a national-security leak allegation into a test of how commodities law applies to prediction markets. The CFTC said this is the first time it has charged insider trading involving event contracts and the first time it has used the so-called Eddie Murphy Rule for alleged misuse of government information.

The CFTC's March Federal Register notice on prediction markets said the agency is seeking public comment on event-contract derivatives, core principles, public-interest limits, cost-benefit questions and inside information. The notice said prediction markets let participants buy and sell contracts based on whether stated events occur, and that those contracts may fall within the Commodity Exchange Act definition of a swap or a futures contract.

The regulatory issue is practical as well as legal. If event contracts trade like derivatives, then traders with confidential government information can affect market integrity in the same way corporate insiders can affect securities or commodities markets. If event contracts also track military action, sanctions, elections or foreign-policy decisions, the possible harm can include national-security exposure as well as financial profit.

The Response

CFTC Chairman Michael S. Selig framed the case as a warning to traders in regulated derivatives markets.

"I have been crystal clear that anyone who engages in fraud, manipulation, or insider trading in any of our markets will face the full force of the law." - Michael S. Selig, CFTC chairman

Selig also linked the allegation to military safety and public trust.

"The defendant was entrusted with confidential information about U.S. operations and yet took action that endangered U.S. national security and put the lives of American service members in harm's way." - Michael S. Selig, CFTC chairman

CFTC Enforcement Director David I. Miller said the agency views the alleged conduct as a breach of government duty as well as a trading case.

"All members of the government, including service members, owe a duty of trust and confidentiality to the government and the American people." - David I. Miller, CFTC director of enforcement

Acting Attorney General Todd Blanche said the spread of prediction markets does not change the legal duties attached to classified information.

"Widespread access to prediction markets is a relatively new phenomenon, but federal laws protecting national security information fully apply." - Todd Blanche, acting attorney general

U.S. Attorney Jay Clayton for the Southern District of New York said prosecutors view the alleged trading as insider trading.

"Prediction markets are not a haven for using misappropriated confidential or classified information for personal gain." - Jay Clayton, U.S. attorney for the Southern District of New York

FBI Director Kash Patel said clearance holders should expect enforcement if they use official access for personal profit.

"Any clearance holders thinking of cashing in their access and knowledge for personal gain will be held accountable." - Kash Patel, FBI director

By The Numbers

• $33,034: Approximate amount the Justice Department said Van Dyke wagered on Maduro and Venezuela-related outcomes.
• $409,881: Approximate profit prosecutors said Van Dyke made from the alleged scheme.
• More than 436,000: "Yes" shares the CFTC said Van Dyke bought in the "Maduro Out by January 31, 2026?" contract.
• 13: Approximate number of bets prosecutors said Van Dyke made from Dec. 27 through Jan. 26.
• 5: Criminal counts listed in the Justice Department announcement.

What To Watch Next

The immediate track is in federal court, where the Justice Department must prove the criminal charges and the CFTC must prove its civil claims. The Justice Department said Assistant U.S. Attorneys Nicholas W. Chiuchiolo, Ryan B. Finkel and Juliana N. Murray are handling the prosecution, with support from the National Security Division.

The policy track sits with the CFTC. Its Federal Register notice said comments on the prediction-market rulemaking were due April 30, 2026, and that the commission may use the record to inform future agency action.

For prediction-market operators and traders, the message from regulators is that event contracts can bring the same insider-information restrictions that apply in other federally regulated derivatives markets. For service members and other clearance holders, the case signals that the government may treat market bets tied to classified operations as both a national-security matter and a market-integrity offense.