Institute Of Internal Auditors Urges U.S. To Tighten Rules On Prediction Markets

The Institute of Internal Auditors (IIA) has asked U.S. regulators and lawmakers to introduce stricter oversight for prediction market platforms. In letters sent to the Commodity Futures Trading Commission (CFTC) and members of Congress, the body outlined risks linked to these platforms.

It flagged concerns around the use of non-public information, gaps in outcome verification, and limits in monitoring systems. The institute said new rules should include governance standards, internal controls, and audit requirements. It proposed that operators adopt formal control frameworks to address insider trading, manipulation, and conflicts of interest. It also called for internal audit functions within regulated exchanges, with reporting lines to governing Boards.

The institute recommended aligning oversight of prediction markets with existing financial market standards. It also urged Congress to direct the Government Accountability Office to review current practices and identify gaps.