Prediction market operator Polymarket came under fresh scrutiny after a reported wave of stolen-card activity on its US platform coincided with leadership pressure to keep expanding, according to an investigation by The Wall Street Journal.
In February 2026, shortly after the regulated U.S. venue began onboarding users from a waitlist, criminals attached stolen debit cards to newly created accounts.
They deposited funds, placed wagers, and then tried to move proceeds onto cards or accounts they controlled. The attempted transfers totaled at least $10 million.
Payment processor Checkout.com flagged the surge and, at one point, classified more than 80 percent of the deposits it handled for Polymarket US as fraudulent—far above a typical industry rate near 1 percent.
A small group of accounts drove most of the activity; one user alone attempted thousands of deposits.
How much of the $10 million actually left the platform was not established, and one person familiar with the matter said most attempted deposits failed.
Compliance staff raised the alarm with Chief Executive Shayne Coplan.
People familiar with the discussions said his reaction stunned the team: keep growing and treat any later regulatory penalty as a cost of doing business.
Around the same period, users were complaining about slow withdrawals.
Management removed a same-source withdrawal rule that required payouts to return to the original funding method, a control often used to limit money-laundering risk.
Employees had warned that dropping the restriction could create new vulnerabilities.
Fraud rates stayed elevated for months before falling back toward industry norms by May after the company limited how many debit cards could be linked to an account and hired fraud-prevention firm Riskified.
Several senior US executives later departed, including the chief compliance officer.
An outside review by law firm Sullivan & Cromwell concluded the company had complied with applicable rules, people familiar with the findings said.
A separate July episode involved nearly 500 user accounts compromised with stolen personal data.
Polymarket has since added risk and investigations staff, including a former FBI agent, and named a chief financial officer as it pursues a large funding round at a multi-billion-dollar valuation and positions itself for a possible public listing.
The Commodity Futures Trading Commission (CFTC) has been reported to be examining the February events.
The episode highlights the tension facing a fast-growing prediction market that only recently gained a regulated US foothold after earlier enforcement action.
Former regulators quoted in coverage described the scale of attempted fraud and the internal response as unusual for commodities or gambling businesses. Polymarket has said it monitors suspicious activity, cooperates with authorities, and has strengthened infrastructure and leadership.