Pentagon bans staff from betting on military outcomes

US Defense Secretary Pete Hegseth issued a memo titled "Do Not Compromise Military Operations for Personal Financial Gain" on October 20. The directive was sent to senior Pentagon leadership, Combatant Command leaders, and Defense Department field activity directors. It bars all Department of War personnel from engaging in financial transactions using both classified and unclassified nonpublic information. The ban covers direct actions as well as indirect transactions through third parties.

Hegseth warned that prediction market wagers could expose military operations to adversaries. He stated that enemies watch movements in prediction markets and that the lives of Service members often depend on the enemy not knowing what is coming. The memo argues that financial stakes can warp judgment for military personnel. Hegseth noted that when a Service member engages in a financial transaction on a military outcome, they create a signal exploitable by hostile foreign intelligence services.

The directive follows the April indictment of US Army soldier Gannon Ken Van Dyke. Van Dyke allegedly used classified information about the operation to capture Venezuelan leader Nicolás Maduro to make more than $400,000 on Polymarket. He has pleaded not guilty to all charges. In February, Israeli authorities arrested and indicted a military reservist and a civilian for allegedly using classified information to place bets on Polymarket related to Israeli military strikes on Iran. An August report by the Anti-Corruption Data Collective found 152 suspicious wallets that placed longshot bets on military and defense markets and won a combined $8 million.

Violations of the ban may result in administrative, disciplinary, and criminal action under the Uniform Code of Military Justice and applicable federal law. The White House also warned staff against using private information to trade on prediction markets the same day a report emerged about new accounts making specific bets before President Donald Trump announced a ceasefire with Iran in April.