Pentagon Move Blocks Insider Military Wagers
A new directive warns that unauthorized betting on operational outcomes could compromise troop safety by signaling sensitive details to adversaries.
By Ken Adams ·
The Pentagon is tightening its grip on where service members place their bets, citing national security concerns.
In an October 20 memo issued to senior Pentagon leadership, Combatant Command leaders, and Defense Department field activity directors, Defense Secretary Pete Hegseth warned against engaging in financial transactions involving military outcomes. The directive explicitly prohibits personnel from using any nonpublic information to place wagers on prediction markets or other betting platforms, regardless of whether the underlying data is classified.
The directive arrives in response to documented instances of insider trading linked to military intelligence. In April, a US Army soldier faced arrest for allegedly using confidential information to place bets totaling $410,000 on Polymarket regarding the timing of the capture of Venezuelan President Nicolás Maduro. Additionally, an August report by the Anti-Corruption Data Collective identified 152 suspicious wallets that placed longshot bets on defense-related markets, resulting in a combined payout of $8 million.
Hegseth argues that the prohibition extends to all financial platforms, including traditional betting services and prediction markets such as Polymarket and Kalshi. The policy applies to American Service members, intelligence professionals, and other Department civilians, barring them from making transactions informed by nonpublic information.
The Secretary outlined a direct link between financial speculation and operational security. "Our enemies watch movements in these markets," Hegseth wrote. "When an American Service member, intelligence professional, or other Department civilian engages in a financial transaction on a military outcome, they create a signal."
He warned that such signals can be aggregated and exploited by hostile intelligence services to anticipate movements, targets, and timing, emphasizing that the safety of troops depends on the element of surprise.
Hegseth’s memo, published on October 21, stated clearly that personnel must not compromise military operations for personal financial gain. He emphasized that those who enter harm’s way deserve a force that protects them rather than one that exposes them to the enemy for profit.
Source: Ars Technica
