Pentagon bars use of nonpublic information for military bets

A Defense Department directive dated Oct. 20 tells covered personnel not to use classified or unclassified nonpublic information in financial transactions tied to military outcomes. It names prediction-market platforms Polymarket and Kalshi, but the restriction is not a blanket ban on personnel using those platforms.

CBS News reported that Defense Secretary Pete Hegseth addressed the memorandum to senior Pentagon leadership and combatant commanders. The directive covers service members, intelligence professionals and other Defense Department civilians, according to CBS. Its reach turns on both the information used and the subject of the transaction: the information must be nonpublic military information, and the transaction must concern a military outcome.

What the directive restricts i

The memorandum’s stated concern is that trading could create signals that foreign intelligence services might use to anticipate U.S. military movements, targets or the timing of operations. That is the rationale given for the directive, not evidence that trading has exposed an operation or caused a security breach.

The memorandum warns that violations could lead to administrative discipline or criminal action under federal law or the Uniform Code of Military Justice. It is a department directive, not legislation or a court ruling; it does not itself establish that anyone violated the rule or create a finding of criminal guilt.

The Washington Post reported that the memorandum does not specify whether government contractors are covered. The directive identifies Defense Department personnel, including service members and civilian employees.

Van Dyke case remains a separate proceeding i

The directive is distinct from the criminal case against Army Master Sgt. Gannon Ken Van Dyke. The Justice Department announced charges against him in April 2026 over alleged use of classified information to profit from prediction-market bets. Van Dyke has pleaded not guilty in federal court in New York.

CBS News reported that the alleged bets exceeded $33,000 and the reported winnings topped $409,000. Those figures describe allegations and reported winnings, not a finding that Van Dyke committed a crime.

On Oct. 7, The Washington Examiner reported that U.S. District Judge Margaret Garnett heard arguments on Van Dyke’s motions to dismiss the case, took the motions under advisement and issued no ruling that day. The report said Garnett questioned lawyers about the charges and the legal basis for applying commodities and fraud laws to the alleged trades. That procedural update does not resolve the motions or the allegations.

The distinction is practical: the Pentagon directive sets an instruction for covered personnel, while Van Dyke’s case concerns allegations against one defendant. Neither the directive nor the reported court hearing establishes that a military operation was exposed or that Van Dyke is guilty.