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Is Insider Sports Betting a Federal Crime?

For the first time ever, the government has filed fraud charges over insider trading on a prediction market. Could athletes, coaches, and trainers be next?

Terry Rozier
Consider the case of NBA guard Terry Rozier, whom federal prosecutors recently indicted over an alleged gambling scheme in which he would remove himself from games while associates sold that information to bettors. (Rozier has denied the allegations.) It’s been billed as an insider trading case, but the government’s charge is actually wire fraud conspiracy—and that distinction is doing a lot of work. Photo: Tomas Diniz Santos/Getty Images
Eriq Gardner
May 4, 2026

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For decades, the sports world’s gambling problem was treated as a disciplinary matter: Pete Rose was banned, Tim Donaghy was suspended, etcetera—and usually at the discretion of league commissioners. Then the Supreme Court blew open the door for states to legalize sports betting, prediction markets arrived, and the gambling business entered a new, more legally treacherous era. Last month, federal prosecutors charged U.S. Army soldier Gannon Ken Van Dyke with commodities fraud after he earned roughly $400,000 by trading on Polymarket using classified information about Nicolás Maduro’s fate—the first time the government has pursued criminal insider trading charges related to a prediction market.