> Is insider trading a crime on prediction markets?

Yes, it is both against the CFTC's regulations and against the companies' T&Cs.

> Doesn’t it contribute to the accuracy of the pricing of prediction contracts, and therefore is good for the prediction market?

That's irrelevant, the purpose of these markets is to provide fair bets for entertainment, not information.

  I’m completely failing to get outraged here.

  I think that the person that a/b/c deserves prison or other discipline, but I’m struggling to otherwise see the harm in what they did. Is insider trading a crime on prediction markets? Doesn’t it contribute to the accuracy of the pricing of prediction contracts, and therefore is good for the prediction market?

b. lobbied the president to attack Iran

c. neglected critical aid spreading Ebola

By the way there are reasons why we ban sport people from betting or insiders to disclose their (and relatives) trades to the sec: incentives.

It seems like the prediction market crowd cannot understand the economics of incentives and their harmful consequences.

Even though we already see the harm in the real world with journalists receiving death threats for reporting news or randoms tampering with meteorological equipment to win bets.

And that's only what we know.