White House warns staff on insider trading amid Iran war bets
This comes after a series of recent well-timed and profitable wagers raised questions
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[WASHINGTON, DC] The White House sent an internal staff-wide e-mail, which warned employees against using confidential information to place trades on financial markets and fast-growing event betting platforms.
The warning comes after a series of recent well-timed and profitable bets raised questions about potential insider trading around US President Donald Trump’s decision-making on military manoeuvres in Iran and Venezuela.
The e-mail was sent from the White House management office on Mar 24, said a White House official who asked not to be identified discussing a confidential matter.
On Mar 23, President Donald Trump had cited “productive conversations” with Teheran, and announced a five-day pause on his threat to attack Iranian power plants in a social media post.
Billions of dollars worth of futures for oil and stocks changed hands just 15 minutes before Trump’s post, which sent crude prices tumbling and equities soaring.
Contracts corresponding to at least six million barrels of Brent and West Texas Intermediate were sold in the two minutes from 6.49 am in New York on Mar 23, based on exchange data compiled by Bloomberg.
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The average for the same time period over the previous five trading days was about 700 lots – or 700,000 barrels. Trump’s Truth Social post was published at around 7.05 am that day.
The staff-wide e-mail was first reported by The Wall Street Journal.
White House spokesperson Davis Ingle said: “President Trump has been crystal clear: While he seeks a strong and profitable stock market for everyone, members of Congress and other government officials should be prohibited from using non-public information for (their own) financial benefit.
“The only special interest that will guide President Trump is the best interest of the American people.”
Stocks and oil prices have been volatile due to the US and Israeli war on Iran.
However, the unusual pattern in futures trading after Trump’s announcement, as well as the surge in bets placed in online prediction markets, have drawn scrutiny amid questions about whether bettors are trading on inside information.
A series of well-timed Iran wagers placed on Polymarket by freshly created anonymous accounts have generated hundreds of thousands of dollars in profits so far, prompting analysts to scour the trades for telltale signs of insider activity.
Some payouts on Middle East-related bets are now frozen in a dispute, with traders unable to collect as users debate what constitutes a ceasefire.
Profitable bets placed just before the US capture of Venezuelan strongman Nicolas Maduro earlier this year also sparked questions about the use of confidential information.
Federal employees are banned from gambling while on government property, and ethics rules prohibit the use of non-public government information for personal gain.
While there has been no evidence that White House staff have profited off insider trading, the e-mail to staff highlights the focus on prediction markets.
It is a nascent industry that has exploded in interest and growing concerns that there are insufficient guardrails to prevent insider trading.
Ingle said: “All federal employees are subject to government ethics guidelines that prohibit the use of non-public information for financial benefit.
“However, any implication that administration officials are engaged in such activity without evidence is baseless and irresponsible reporting.” BLOOMBERG
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