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A federal judge has paused the Commodity Futures Trading Commission’s civil case against U.S. Army Special Forces Master Sergeant Gannon Ken Van Dyke while a parallel criminal prosecution over his Polymarket trading moves forward.
U.S. District Judge Andrew Carter granted the stay on August 10, ordering the CFTC case paused pending the outcome of the criminal proceeding. Van Dyke is accused of using classified information about a U.S. military operation to capture Nicolás Maduro to profit from Venezuela-related event contracts.
Criminal Prosecution Will Proceed Before CFTC Case
Federal prosecutors sought the stay in July because the civil and criminal proceedings involve substantially overlapping conduct, evidence and legal questions. Van Dyke opposed the request and sought to litigate both cases simultaneously.
The order does not dismiss the CFTC complaint or determine whether Van Dyke violated commodities law. The regulator’s claims remain pending while the Justice Department pursues the criminal case.
Indictment Says 13 Trades Generated $409,881
Prosecutors allege Van Dyke participated in planning and executing Operation Absolute Resolve and possessed material nonpublic information about the mission when he traded Maduro and Venezuela-related contracts.
The indictment says Van Dyke purchased approximately $33,934 of “Yes” shares across 13 trades between December 27 and January 2. His positions covered Maduro’s removal, U.S. forces entering Venezuela, a possible U.S. invasion and President Donald Trump invoking war powers. Prosecutors allege the trading ultimately generated about $409,881 in profit.
The CFTC separately alleges that Van Dyke bought more than 436,000 “Yes” shares in the “Maduro Out by January 31, 2026?” contract and generated more than $404,000 through his trading. It seeks restitution, disgorgement, civil penalties and trading and registration bans.
Van Dyke Challenges Prediction Contracts’ Status as Swaps
Van Dyke has pleaded not guilty and moved to dismiss the criminal indictment. His lawyers argue, among other theories, that the Commodity Exchange Act is ambiguous about treating prediction-market event contracts as swaps.
The CFTC describes the case as its first insider-trading action involving event contracts and its first use of the so-called “Eddie Murphy Rule” in a case involving misuse of government information.
The criminal proceeding now moves ahead while the CFTC action remains stayed. No court has ruled that Van Dyke committed the alleged insider trading.
