Share 
A Wall Street Journal investigation found that Polymarket, the world’s largest prediction market platform, paid social media influencers to stage fake trades and post phony winnings to attract US users. The June 20 report has since triggered a CFTC probe, a consumer lawsuit, and a congressional inquiry.
Polymarket’s fake-win influencer network
The WSJ reported that Polymarket paid mostly college-age creators $2,000 to $3,000 a month to film staged trades and celebrations on near-identical dummy versions of its website, instructing them to keep the arrangement secret.
Reporters reviewed more than 1,100 videos from 10 creators; 118 depicted a combined $1.9 million in fabricated wins that, on the real platform, would have lost more than $166,000.
In one example, college student George Makihara posted a video showing a $100,000 win on a bet that Trump would say “McDonald’s” in January — public data showed every real account on that bet lost, and his celebration footage had reportedly been filmed two months earlier. According to Legal Sports Report, Polymarket also directed “clippers” to reshare the videos, helping them reach over 140 million views across TikTok, YouTube and Instagram.
The mounting legal pressure on Polymarket
Polymarket has not confirmed or denied knowing that the videos were staged and said it is auditing its promotional content. Since the report, the fallout has escalated: the CFTC opened its third investigation into the company — and its first into a licensed prediction market under Chairman Michael Selig — after previously fining Polymarket $1.4 million in 2022 and closing a follow-up probe without charges in 2024.
Sens. Adam Schiff and John Curtis demanded the CFTC disclose by July 10 whether it’s investigating. And on June 26, the National Association of Consumer Advocates sued Polymarket’s parent company, founder Shayne Coplan and CMO Matthew Modabber, alleging a “sweeping and flagrantly deceptive marketing campaign” targeting young Americans.
Legal experts are split on the odds of real enforcement. Gaming attorney Daniel Wallach told Fortune the Trump administration is unlikely to act aggressively, given the CFTC’s reduced staff and single sitting commissioner, and predicted civil lawsuits from bettors are the more likely consequence.
Norton Rose Fulbright’s Steven Lofchie said any action would likely split between the CFTC (unregistered US solicitation) and the FTC (undisclosed paid promotion). Notably, Donald Trump Jr. advises rival Kalshi and holds a Polymarket stake through 1789 Capital — a tie some say complicates prospects for tough federal action.
Why it matters for prediction markets’ credibility
Polymarket has marketed itself as a transparent alternative to traditional betting markets, but the report undercuts that pitch. Smarkets CEO Jason Trost told CBS News that regulated exchanges keep auditable settlement records “for exactly this reason” — to prevent this kind of deception.
The scandal lands amid broader pressure on the industry: state regulators (including Kentucky’s attorney general, who recently sued Kalshi, Polymarket and VGW) accuse prediction markets of using federal licensing to dodge state gambling laws; critics object to contracts tied to wars, disasters or assassinations; a US soldier was charged with insider trading on a Maduro-capture contract; and Polymarket separately disclosed a $3.1 million hack it has pledged to fully refund.
