Polymarket, the prediction-market platform where users trade on the outcomes of real-world events, was reportedly targeted by a large-scale fraud operation earlier this year, according to a new report from The Wall Street Journal.

Criminals attempted to move at least $10 million through the company's U.S. platform using stolen debit cards. The scheme came to light in February. Payment-card fraud is a persistent exposure for any platform that funds accounts through traditional banking rails, since stolen card details can be used to push money through before the theft is detected.

According to the report, fraudsters attached stolen cards to thousands of Polymarket US accounts and attempted to convert the funds into wagers. At the peak of the fraud, payment processor Checkout.com was reportedly rejecting more than 80% of the Polymarket deposits it handled because they appeared suspicious — a rejection rate that points to fraud-screening systems flagging transactions at an unusual scale.

Growth versus fraud controls

The Journal reported that employees raised concerns internally. Current and former workers told the newspaper that CEO Shayne Coplan continued to emphasize growth despite warnings from compliance staff. Those claims have not been independently verified. The friction described in the report reflects a familiar trade-off for consumer trading platforms, where onboarding growth and fraud controls can pull in opposite directions.

Fraud levels reportedly remained elevated for several months after the February spike. Polymarket eventually introduced tighter restrictions on the number of debit cards users could link to accounts. The company had previously required users to withdraw funds back to the same payment source used to make a deposit, but the Journal reported that this restriction was later loosened.

Additional security incidents

The fraud scheme was not the only security issue facing the company. In June, Polymarket confirmed that hackers had stolen funds from some users after a compromise involving a third-party vendor. According to the company, malicious code was injected into its website for certain users.

The Journal also reported a separate incident in July involving nearly 500 users, in which an engineering vulnerability allegedly allowed attackers holding stolen personal information to access existing accounts.

Executive team expansion

The disclosures come as Polymarket pursues further expansion in the United States. Earlier this month, the company appointed veteran finance executive Warren Jenson as its first chief financial officer. Jenson previously served as CFO at Amazon, Electronic Arts, Delta Air Lines and Nielsen.

Polymarket has also brought in former Uber executive Travis VanderZanden as chief growth officer. Taken together, the hires point to a company building out its leadership as it scales in the U.S. — a phase in which payment integrity and account security are likely to draw continued attention following the Journal's findings.

The original report was published by U.Today.