Employer restrictions, MNPI risk, and the Goldman Sachs ban
July 2026: Major Wall Street firms updated employee policies
Goldman Sachs, Morgan Stanley, JPMorgan Chase, and Bank of America all updated their employee conduct policies in July 2026 to address prediction-market trading. Goldman's policy — the most explicit — bans employees from trading event contracts tied to financial markets, macroeconomic data, and elections, while permitting sports and entertainment contracts. Bloomberg News first reported the Goldman policy on July 9, 2026; Reuters confirmed additional firm policies the same day.
Finance professionals asking whether they can trade prediction markets are actually asking two distinct questions that have different answers.
Yes. Kalshi is a CFTC-designated contract market — a federally regulated exchange. Trading event contracts on Kalshi or Polymarket is legal for US individuals, including those who work in finance. There is no law that prohibits finance professionals from using these platforms.
The exception: using material non-public information (MNPI) to trade event contracts can violate the Commodity Exchange Act and fraud statutes, just as it would in securities or futures markets.
It depends. Major Wall Street firms updated their policies in July 2026. Goldman Sachs explicitly banned financial, macroeconomic, and political event contracts for all employees. Morgan Stanley, JPMorgan, and Bank of America added or clarified similar restrictions.
If you work at a financial institution, you need to read your firm's specific personal-trading policy — "it's probably fine" is not an adequate compliance posture after Goldman's public memo.
Goldman's policy is the most detailed to become publicly known, via Bloomberg News (July 9, 2026) and subsequently corroborated by Reuters, CNBC, and the New York Times.
As reported by Reuters (July 9, 2026) and subsequently confirmed by individual firm sources. Policies change — confirm with your firm's compliance department.
| Firm | Policy Summary | Source | Confirmed |
|---|---|---|---|
| Goldman Sachs | Banned: contracts tied to Goldman itself, financial markets, macroeconomic data, elections, geopolitics, Bitcoin price, ceasefire dates, and merger regulatory approvals. Sports and entertainment contracts permitted. Repeat violations: termination possible. Gains over $200 from prohibited trades must be forfeited or donated to charity. | Bloomberg News (first reported), Reuters, CNBC — July 9, 2026 | |
| Morgan Stanley | Added prediction-market rules to employee code of conduct. Specific prohibitions not publicly disclosed. | Reuters, July 9, 2026 | |
| JPMorgan Chase | Code of conduct prohibits trading on non-public, confidential information, expressly extended to prediction market betting. Guidance circulated internally spring 2026. | Reuters, July 9, 2026 | |
| Bank of America | Restricts employees from trading company-specific, macroeconomic, and financial-services prediction-market contracts. BofA spokesperson confirmed updated guidance. | Reuters, July 9, 2026; BofA spokesperson | |
| Other major firms | Not yet publicly announced. Check your firm's personal-trading policy and employee handbook. | Confirm with your compliance department. | Unconfirmed |
Banned: contracts tied to Goldman itself, financial markets, macroeconomic data, elections, geopolitics, Bitcoin price, ceasefire dates, and merger regulatory approvals.
Sports and entertainment contracts permitted.
Repeat violations: termination possible. Gains over $200 from prohibited trades must be forfeited or donated to charity.
Bloomberg News (first reported), Reuters, CNBC — July 9, 2026
Added prediction-market rules to employee code of conduct. Specific prohibitions not publicly disclosed.
Reuters, July 9, 2026
Code of conduct prohibits trading on non-public, confidential information, expressly extended to prediction market betting. Guidance circulated internally spring 2026.
Reuters, July 9, 2026
Restricts employees from trading company-specific, macroeconomic, and financial-services prediction-market contracts. BofA spokesperson confirmed updated guidance.
Reuters, July 9, 2026; BofA spokesperson
Not yet publicly announced. Check your firm's personal-trading policy and employee handbook.
Confirm with your compliance department.
The restrictions are driven by compliance concerns, not legal mandates. Understanding the reasons helps you apply the logic to your own situation.
A Goldman analyst who covers energy companies and then trades event contracts tied to oil prices — even without using confidential data — creates an appearance of conflict that regulators and clients may scrutinize. Firms want to eliminate that optics problem entirely.
Employees at banks and asset managers routinely encounter information that could affect the outcome of prediction-market contracts — upcoming earnings, merger talks, macro data before public release. Using that information to trade event contracts can constitute fraud under the Commodity Exchange Act, even though these contracts are not securities.
Federal prosecutors charged a Google engineer with using confidential "Year in Search" data to make approximately $1.2 million in profits on Polymarket (total wagers ~$2.75 million). The case demonstrated that event-contract trading creates measurable insider-trading exposure — not theoretical. Wall Street compliance teams took notice.
The CFTC issued a prediction-markets compliance advisory in March 2026 and followed with a full Notice of Proposed Rulemaking (NPRM) on June 10, 2026 on event contracts. (An Advance Notice of Proposed Rulemaking was issued March 16, 2026.) Heightened regulatory attention makes firms more conservative: if the CFTC is watching, compliance teams want clean records.
One of the most common compliance misconceptions involves which regulatory framework governs prediction-market trading for finance professionals.
Kalshi is a CFTC-designated contract market (DCM). Event contracts on Kalshi are futures-like instruments regulated under the Commodity Exchange Act (CEA) — not securities. The CFTC oversees the exchange, the contracts, and the trading rules.
Using MNPI to trade event contracts can violate CEA Section 9(a)(2) and other anti-fraud provisions. The CFTC has broad authority over fraud and manipulation in commodity markets, which includes event contracts.
FINRA rules — including Rule 3110 (supervision) and Rule 3210 (accounts at other broker-dealers) — govern securities transactions at FINRA member broker-dealers. They don't directly regulate event-contract trading on CFTC-licensed exchanges.
However, many broker-dealer firms apply the spirit of their FINRA compliance frameworks broadly, treating event contracts as trading activity that triggers the same review and preclearance obligations as securities.
These are related but distinct. Goldman's policy bans certain prediction-market trades even for employees who don't have MNPI relevant to those trades. The ban is prophylactic: it eliminates a category of risk before any specific violation occurs.
What the employer ban covers
What insider trading law covers
For a full treatment of the insider trading rules as they apply to prediction markets, see our prediction market insider trading guide.
A practical checklist for finance professionals who want to know where they stand.
Most major firms distribute these annually. Search your intranet for "personal trading policy," "employee trading guidelines," or "code of conduct — investments." Goldman's policy is explicit; others are less so.
Some agreements include broad conflict-of-interest clauses that could cover prediction-market trading in relevant subject areas — particularly if you work in roles with access to material information.
If the policy doesn't address prediction markets specifically, ask your compliance or legal department for written guidance. Do this before trading, not after. Getting a "yes" or "no" in writing protects you if questions arise later.
Even if your firm hasn't updated its policy, using material non-public information to trade event contracts can violate the Commodity Exchange Act and other fraud statutes. If a trade is profitable because of information your colleagues don't have, consult a lawyer.
A Goldman equity analyst in the financial markets division and a Goldman summer analyst in the consumer retail division face very different risk profiles from the same policy. What markets you can access on Kalshi or Polymarket depends on what information you routinely handle.
No — trading on CFTC-regulated prediction market platforms is legal for US individuals, including finance professionals. Kalshi is a CFTC-designated contract market. The restriction is not from law but from employer policy and the general prohibition on using material non-public information to trade any market, including event contracts.
Goldman Sachs updated its personal trading policy in July 2026 to prohibit employees from trading event contracts tied to the bank itself, financial markets, macroeconomic data, elections, geopolitics, Bitcoin price, ceasefire dates in conflicts, and merger-related regulatory approvals. Sports and entertainment prediction-market contracts remain permitted. Bloomberg News first reported the policy; Reuters and CNBC confirmed.
Morgan Stanley added prediction-market rules to its employee code of conduct (Reuters, July 2026). JPMorgan Chase expressly extended its non-public-information trading prohibition to prediction markets. Bank of America updated its conduct guidelines to restrict event contracts in company-specific, macroeconomic, and financial-services categories. A BofA spokesperson confirmed the change. Goldman Sachs was the first to issue an explicit public-domain memo with specific prohibited categories.
FINRA rules govern securities transactions at broker-dealers — they don't directly regulate event contracts on CFTC-designated exchanges like Kalshi. However, FINRA Rule 3110 (supervision) and Rule 3210 (accounts at other broker-dealers) create frameworks that firms apply broadly. More directly relevant is each firm's own personal-trading policy, which typically covers any trading that creates conflicts of interest regardless of asset class.
Consequences vary by firm. Under Goldman Sachs's policy, repeated violations can result in disciplinary action including termination. Employees may be required to forfeit or donate to charity any gains over $200 from prohibited trades. At other firms, consequences range from formal warnings to termination depending on the severity of the violation and whether MNPI was involved. If MNPI was used, criminal and civil liability under the Commodity Exchange Act becomes a separate risk.
The restrictions in firm policies typically apply to the activity — trading event contracts linked to prohibited subject areas — not to specific platforms. Whether you trade through Kalshi, Polymarket, or another CFTC-regulated platform, the same employer restrictions apply if the contract subject matter falls in a prohibited category.
Federal employees, members of Congress, and other officials face a separate set of restrictions under the STOCK Act and executive-branch ethics rules. Those rules govern trading on non-public information related to their official duties and are distinct from private-sector employer policies. See our guide on government officials and prediction markets.
Disclosure
This guide is for informational purposes only and does not constitute legal, compliance, or financial advice. Employer policies vary by firm and change over time. The firm policy information above is based on reporting by Bloomberg News, Reuters, CNBC, and the New York Times as of July 2026. Always confirm current policy with your firm's compliance department before trading. This site may receive compensation from platforms linked herein.
