Goldman Sachs Limits Employee Betting on Prediction Platforms Amid Insider Trading Concerns

Goldman Sachs has imposed restrictions on its employees from betting on prediction platforms such as Polymarket and Kalshi, Bloomberg reports. These limitations apply to wagers related to the bank itself, elections, financial markets, macroeconomic data, and geopolitical events. The bank warned that repeated violations of this policy could result in termination or account closure. In cases of improper trades, employees may be required to forfeit profits exceeding $200 or donate them to charity. A Goldman Sachs spokesperson declined to comment.

Prediction platforms, while popular for sports betting, allow wagers on a wide range of topics, including the timing of an attack on Iran or corporate earnings. This raises insider trading risks, especially for financial sector employees who often have access to non-public information. Goldman Sachs's decision follows the first insider trading case involving prediction platforms and a private sector employee. In May, the Commodity Futures Trading Commission (CFTC) and the Department of Justice charged a Google employee for using material non-public information to trade futures contracts on Polymarket related to popular search rankings, allegedly earning about $1.2 million.

CNBC contacted 50 public and private companies about their policies on prediction platforms. Only three confirmed having explicit policies, while two others are reviewing the issue. United Airlines stated it has no explicit policy but prohibits employees from using confidential company information for personal gain. JPMorgan Chase advised employees to exercise caution when trading on prediction platforms, especially in financial sector contracts. Morgan Stanley confirmed having a policy but did not provide details. Bank of America is updating its internal policy to define prohibited activities and clarify expectations regarding trading on these platforms.