US defense secretary Pete Hegseth (Pic credit: AP)
Gannon Ken Van Dyke, a 38-year-old Special Forces soldier accused of using classified information about the operation to capture then-Venezuelan President Nicolás Maduro. Federal prosecutors allege that Van Dyke placed more than $32,500 in bets between December 30 and January 2, with most of the trades occurring hours before missiles struck Caracas. He allegedly made approximately $409,881 through Polymarket contracts connected to Maduro’s removal and American military action in Venezuela.
The Pentagon said it had no further information to share beyond the memo, which CBS News first reported.
The order applies to service members, intelligence staff and Pentagon civilian employees, according to the AP. “This prohibition applies whether the transaction is informed by classified or unclassified information,” Hegseth wrote in the memorandum. He said unusual betting activity could warn foreign intelligence services about planned US operations, including possible targets and attack dates. “Our enemies watch movements in these markets,” Hegseth wrote. Hegseth also said personal financial interests could affect how personnel perform their duties. The Justice Department said the trades were based on classified details about the operation’s timing.
Pete Hegseth has barred US military personnel from using non-public information to bet on military events. It covers regular online betting services and prediction markets such as Polymarket and Kalshi, where users put money on whether an event will happen. Anyone who breaks the rule could face workplace punishment or criminal charges under federal or military law. “When an American Service member, intelligence professional, or other Department civilian engages in a financial transaction on a military outcome, they create a signal. Prediction-market prices change as users place trades, meaning a surge in bets from people with access to military information could indicate that an operation is approaching. The memo warns that adversaries could examine that activity to anticipate American targets, troop movements or the timing of an attack. “Beyond operational security, financial stakes can warp judgment. A logistician with money riding on a strike date has an interest in that date. An analyst with a position on an outcome has an interest in that outcome,” he wrote in the memo. The order follows the April arrest of Master Sgt. The allegations have not been proven in court. Concerns about government-linked betting extend beyond the military. Kalshi also suspended and fined three congressional candidates who wagered on their own election results. You use AI every day. Now get your AI Quotient. Take the AIQ test.
The White House previously warned staff against trading with private information after newly created Polymarket accounts made well-timed bets before a US-Iran ceasefire announcement.