Polymarket Faked Trades. Trump’s Family Ties Mean No Regulator Will Ever Investigate

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(SeaPRwire) –   By: Gavin Thorne

This isn’t just a marketing scam by a fast-growing prediction platform. It’s a textbook example of regulatory capture playing out in plain sight. Every party involved has direct, financial ties to the people who are supposed to enforce the law. The public gets a performative show of audits and potential probes, but no one actually expects any real consequences. That’s the unspoken story the official reporting only hints at.

Let’s lay out the raw, confirmed facts first. The Wall Street Journal reported Polymarket, a prediction market valued at $9 billion, paid influencers to fake trades and fabricate winnings for marketing. Polymarket was banned from operating in the US starting in 2022. It won a license from the Commodity Futures Trading Commission, the US regulator for prediction markets, this past January. The company has promised a full audit of all active promotional content to align with legal standards.

Legal experts have laid out the clear open path for federal enforcement. Steven Lofchie, a securities and commodities law partner at Norton Rose Fulbright, says the FTC would have an open-and-shut case against Polymarket over its misleading influencer marketing. The CFTC could also bring charges for evading registration requirements to attract US customers before it secured its license. Both agencies declined to respond to requests for comment on the allegations.

Now we get to the parts that rarely make front page headlines. The CFTC under the Trump administration has cut roughly a quarter of its entire staff. It pushed out career regulators who pushed for investigations into crypto and prediction markets. The agency’s only sitting chairman is Michael Selig, a former corporate lawyer who represented crypto and prediction market firms for years. He is a long-time industry ally who previously led the SEC’s crypto task force.

The ties go all the way to the top of the current administration. Donald Trump Jr. is a paid advisor to Polymarket’s top competitor, Kalshi. He is also a major investor in Polymarket itself through 1789 Capital, the venture capital firm where he serves as a partner. Gaming attorney Daniel Wallach says the CFTC has abandoned enforcement to align fully with the industry it regulates. It only has one of five commissioner seats filled, so it has no capacity to act anyway.

Only private civil lawsuits from defrauded bettors will ever hold Polymarket accountable for its fake marketing.

Author bio: Gavin Thorne, investigative journalist based in DC covering special interest influence and federal legislative affairs.