- Fraudsters attempted to steal at least US$10 million (AU$14 million) from Polymarket’s US platform from February using stolen debit cards, the Wall Street Journal reported 20 September.
- Payment processor Checkout.com at one point rejected more than 80% of the platform’s US deposits as fraudulent, against an industry norm of roughly 1%, per the report.
- CEO Shayne Coplan told staff to keep growing and pay a fine if regulators found out, people cited by the Journal said, while a law firm review concluded Polymarket complied with regulations.
Polymarket faced an attempted theft of at least US$10 million (AU$14 million) early this year as fraudsters ran stolen debit cards through its US platform, according to a Wall Street Journal investigation into the prediction platform’s compliance record during its US growth push.
Fraudsters began targeting the platform in February, the Journal reported, linking stolen cards to thousands of new US accounts, funding bets and attempting to withdraw the winnings to cards or accounts they controlled.
About seven users drove the bulk of it; one attempted roughly 4,000 separate deposits. Most attempted deposits failed, and the report did not establish how much was ultimately stolen.
Payment processor Checkout.com at one point rejected more than 80% of the US deposits it handled for Polymarket as fraudulent, against an industry norm of roughly 1%, according to the investigation.
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When compliance staff took the fraud alarm to chief executive Shayne Coplan, he told them to keep growing and pay a fine if regulators ever found out, people cited by the newspaper said. US chief compliance officer Andrew Clifford resigned in April after submitting a detailed fraud report, while US chief executive Justin Hertzberg was fired and the heads of US regulation and anti-money-laundering also departed.
The Commodity Futures Trading Commission is investigating, and employees have been told to preserve records related to the fraud attack, the report stated.
A separate July incident hit about 500 users through stolen personal data and an engineering weakness; Polymarket agreed to cover the losses.
An earlier Journal investigation in June examined promotional videos showing fake customer winnings, and one study this year put possibly artificial activity at about a quarter of Polymarket’s trading.
Polymarket Points to Its Controls
A Polymarket spokesperson told the Journal the company is committed to fair and transparent markets and to cooperating with regulators and law enforcement. “Our market integrity framework includes processes to detect, review and respond to suspicious activity”, the spokesperson stated.
By the company’s account, fraud rates returned to industry norms by May after Polymarket capped the debit cards linkable to an account, hired fraud-prevention firm Riskified and added risk staff. A review by law firm Sullivan & Cromwell concluded the company complied with regulations, people familiar with its findings told the Journal.
The US expansion runs on Polymarket’s US$112 million (AU$156.8 million) July 2025 acquisition of CFTC-licensed exchange and clearinghouse QCEX, which won it a green light to relaunch for US traders.
The company is now seeking about US$1 billion (AU$1.4 billion) at a roughly US$21 billion (AU$29.4 billion) valuation, the Journal reported, a step up from valuations floated earlier this year, with Donald Trump Jr.’s 1789 Capital contributing about US$300 million (AU$420 million).
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