Prediction-market giant Polymarket was reportedly targeted by a large-scale fraud operation earlier this year.
Criminals attempted to move at least $10 million through its U.S. platform with the help of stolen debit cards.
The scheme became known in February, according to a new report from The Wall Street Journal.
Fraudsters attached stolen cards to thousands of Polymarket US accounts and tried converting them into wagers.
At the peak of the fraud, payment processor Checkout.com was reportedly rejecting more than 80% of the Polymarket deposits it handled because they appeared to be suspicious.
Growth versus fraud controls
According to the WSJ, employees raised concerns internally.
Current and former workers told the newspaper that CEO Shayne Coplan continued to emphasize growth despite warnings from compliance staff.
Those claims have not been independently verified.
Fraud levels reportedly remained elevated for several months after the February spike.
Polymarket eventually introduced tighter restrictions on the number of debit cards.
The company had previously required users to withdraw funds back to the same payment source used to make a deposit.
The Journal reported that this restriction was later loosened.
Another security incident
In June, Polymarket confirmed that hackers had stolen funds from some users after a compromise involving a third-party vendor. Malicious code was injected into the company’s website for certain users, according to the company.
The Journal also reported a separate incident in July involving nearly 500 users. An engineering vulnerability allegedly allowed attackers with stolen personal information to access existing accounts.
Bolstering executive team
In the meantime, Polymarket has pursued further expansion in the United States.
Earlier this month, the company appointed veteran executive Warren Jenson as its first chief financial officer. Jenson previously served as CFO at Amazon, Electronic Arts, Delta Air Lines and Nielsen.
Polymarket has also brought in former Uber executive Travis VanderZanden as chief growth officer.
Arman Shirinyan
Dan Burgin
