Rep. Sam Liccardo today asked the nation’s top financial regulators if they are investigating possible illegal oil trades placed moments before President Donald Trump provided a major update on the Iran war.
In a letter sent today to Securities and Exchange Commission Chair Paul Atkins and Commodity Futures Trading Commission Chair Michael Selig, both Trump appointees, the San Jose freshman Democrat said he was writing to “express alarm over recent reporting that indicates large trades were made on crude oil prices and S&P 500 E-mini Futures right before the President announced action, or lack thereof, in Iran.”
“The timing indicates bets were placed by those with advance knowledge of the President’s action, strongly suggesting illicit trading on insider information, in violation of the Securities and Exchange Act of 1934, the Commodity Exchange Act of 1936, and the Stop Trading on Congressional Knowledge (STOCK) Act of 2012,” Liccardo wrote.
In the letter to Securities and Exchange Commission Chair Paul Atkins and Commodity Futures Trading Commission Chair Michael Selig, both Trump appointees, Liccardo said he wrote to “express alarm over recent reporting that indicates large trades were made on crude oil prices and S&P 500 E-mini Futures right before the President announced action, or lack thereof, in Iran.”
“This activity marks the latest in a series of well-timed, large-volume trades made right before the President announced the next actions of the United States in the Iran war. For example, on March 23, investors sold over $500 million in oil futures, while simultaneously, $1.5 billion in S&P 500 E-mini Futures were bought less than two minutes before the President announced a delay in attacks on Iran’s energy infrastructure,” Liccardo wrote.
“Similarly, less than three hours before President Trump announced a two-week ceasefire with Iran on April 7, speculators placed an approximately $950 million bet in 8,600 combined lots on an anticipated drop in oil prices.”
“Such activity suggests that investors possessed high confidence in profitable outcomes for a very specific commodity,” he said. “Further, the timing and sharp increase in large volume trading activity associated with S&P 500 E-mini Futures suggests high confidence that a large swath of companies would see a highly correlated increase in their equity shares and earnings. Public reports of similarly astoundingly well-timed large wartime bets made on prediction markets tied to equities trading, and on equities options prior to President Trump’s tariff announcements, strongly suggests a pattern of insider corruption.”
Liccardo said recent White House warnings to the President’s staff – many days after these trades– to refrain from insider trading “provide little comfort.”
“No one in federal service needs to be ‘reminded’ of the blatant illegality of personal financial enrichment from their exploitation of confidential information garnered through public service.” Liccardo cited Reuters and Wall Street Journal articles about the oil trades.
Liccardo demanded an immediate response from the SEC to the following questions:
- Has the SEC opened an investigation into the surge in trading activity on S&P 500 E-Mini
- Futures moments before Trump announced action relating to Iran on April 8?
- What tools do you have to monitor and prevent insider trading besides the Consolidated
- Audit Trail, which you have proposed to substantially downgrade?
- Have you solicited information from the prediction market industry to determine if insider trading has
- taken place on platforms and through stock option bets?
- What ability do your agencies have to bring enforcement actions against insider trading actions executed through offshore prediction market accounts?
- Have you conducted and completed previous insider trading investigations on the trading activity that preceded presidential tariff announcements? If so, what was the outcome?
- What criteria do you use to determine whether to investigate insider trading allegations involving government officials?
- What actions and oversight are CFTC and SEC taking to ensure government employees and ancillary persons are not capitalizing on the knowledge afforded by their position to enrich themselves?
