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US House bill would restrict federal officials’ prediction-market trading

Regulation

US Representative Ritchie Torres introduced a bill that would bar federal government employees from trading on prediction markets when they have or may reasonably obtain non-public information through their duties. The proposal followed reported wagers related to Nicolás Maduro’s removal from power, including an account that reportedly made more than $400,000.

The proposal could restrict prediction-market participation by public officials with access to non-public information.

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Regulation

CFTC enforcement director distinguishes exchange rules from federal insider-trading law

CFTC enforcement director David Miller said at a New York conference that trading on information about one’s own involvement in an event would not necessarily breach federal insider-trading law, though it could violate an exchange’s rules. He said misuse of confidential information may breach a duty, while false statements intended to influence contract prices could amount to market manipulation.

Trading on information about one's own involvement in an event would not necessarily breach federal insider-trading law, though it could violate an exchange's rules, CFTC enforcement director David Miller said at the NEXTPredict conference in New York on Thursday. Asked whether former Venezuelan president Nicolás Maduro could legally have bought a contract predicting his own capture after seeing approaching US military helicopters, Miller said such a trade might breach exchange rules without breaking federal law.

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