Illinois bars state workers from betting with inside info

Gov. J.B. Pritzker on Tuesday signed an executive order that prohibits Illinois state officers and employees from using nonpublic government information to place bets or to help others wager on prediction markets. The directive takes effect immediately and covers all state employees and officers.

The order forbids using “nonpublic information obtained through one’s official position” to participate in prediction markets, and it also bans sharing such information to assist another person’s bets. The restriction applies whether or not the employee gains financially from the wager.

Pritzker framed the order as a measure to prevent conflicts between public duties and private financial gain. In announcing the directive, he said the state must ensure officials serve the public rather than seek personal profit.

State officials cited recent reports of suspicious wagering activity on prediction platforms, including strategic bets that paid out large sums ahead of possible diplomatic developments, as a factor behind the order. Officials said those reports raised concerns that privileged government knowledge could be used to win large wagers.

Prediction markets let users buy and sell contracts tied to the outcomes of future events. Contract prices can be read as odds; supporters say the markets aggregate information quickly. Critics warn that market signals can influence the events they predict and create incentives for people to act on inside knowledge.

Olivier Toubia, a professor at Columbia Business School who studies markets, cautioned that markets can shape the events they predict if participants treat odds as fact.

The prediction market industry has grown rapidly. Operators have formed partnerships with sports leagues and entertainment companies and have integrated contract prices into live programming and online coverage to increase audience interaction. Some platforms label wagers as “event contracts” and describe themselves as financial exchanges, a positioning that in some cases allows them to avoid gambling regulations, taxes and age restrictions.

Users can wager on a wide range of outcomes, including political races, diplomatic developments, awards shows and hypothetical scenarios. Media and entertainment executives have argued that interactive prediction tools boost viewer engagement and can support promotion of programs and films.

Illinois’ executive order targets public servants’ use of inside information rather than imposing new rules on prediction markets themselves. The directive’s stated purpose is to protect public trust and reduce opportunities for officials to exploit privileged information for financial gain.