Goldman Sachs bans bets on elections, markets; rule breakers could lose profits and jobs

Goldman Sachs has introduced stricter rules governing employee participation in prediction markets, warning that staff who place bets on restricted events could be required to forfeit all profits and may even face dismissal for repeated violations.

According to a report by the Financial Times, the Wall Street investment bank has instructed employees to limit their activity on prediction market platforms to sports and entertainment events. Betting on political developments, financial markets, interest rates, elections or other sensitive events has been explicitly prohibited.

The tighter policy is aimed at reducing compliance risks and preventing potential conflicts of interest arising from employees' access to confidential or market-moving information.

The report said Goldman communicated the revised guidelines through an internal memo, making it clear that only sports and entertainment prediction markets are permitted. Any wagers linked to elections, stock market indexes, economic indicators, interest rates or other political and financial outcomes fall outside the bank's acceptable use policy.

Employees found violating the rules could be ordered to surrender all gains earned from prohibited bets. Those who repeatedly breach the policy may also face disciplinary action, including termination of employment, the report added.

Large financial institutions typically maintain strict trading and investment rules for employees because many staff members have access to material non-public information that could influence financial markets. The rapid expansion of prediction market platforms has created fresh compliance challenges for banks and other financial firms.

Platforms such as Kalshi and Polymarket, once largely associated with sports-related wagering, now allow users to place bets on a broad range of topics, including elections, macroeconomic data releases and financial market outcomes. Their growing popularity has raised concerns among regulators and financial institutions that individuals with advance knowledge of significant events could potentially profit from such markets.

The Financial Times also highlighted recent incidents that have intensified scrutiny of the sector. In one case, organizers of the Nobel Peace Prize examined a possible information leak after bets correctly predicted the eventual winner before the official announcement.

Separately, a U.S. Special Forces soldier was reportedly accused of placing wagers on Polymarket using alleged advance knowledge of an operation targeting Venezuelan President Nicolás Maduro, further underscoring concerns about insider information being exploited through prediction markets.