Polymarket loosened anti-money-laundering controls amid $10M fraud attack using stolen debit cards

Polymarket, the prediction market platform that became a cultural phenomenon during the 2024 US election cycle, faced a $10 million fraud attack in February 2026 after leadership deliberately weakened anti-money-laundering safeguards in pursuit of growth. The scheme involved fraudsters creating thousands of new accounts linked to stolen debit cards, attempting to process at least $10 million in wagers before withdrawing the funds to accounts they controlled. Checkout.com, Polymarket’s payment processor, flagged and rejected more than 80% of the deposits as suspicious. For context, the typical industry rejection rate sits around 1%. Growth over guardrails According to a Wall Street Journal investigation, Polymarket’s internal compliance team had raised alarms about escalating fraud risks to CEO Shayne Coplan. His reported response: prioritize growth, and deal with potential fines later. One of the most consequential decisions was removing a “same-source” withdrawal requirement. This is a standard industry safeguard that ensures funds can only be withdrawn back to the same account that deposited them. Polymarket employees reportedly warned that scrapping this rule would increase mone...