The White House issued a warning to staff last month against using insider information on the Iran war to bet on financial markets, a White House official said.
The directive came amid a surge of suspicious trading on prediction markets, oil futures and stocks hinging on crucial moments in the conflict. It came in an email dated March 24, amid President Trump’s threats to bomb civilian infrastructure in Iran.
Mr. Trump delayed a deadline for Iran to reopen the Strait of Hormuz on March 23, triggering spikes in trading on global markets. Minutes before his announcement, a select few traders bought some $580 million in oil futures — standing to reap enormous profits once their value increased with Mr. Trump’s announcement.
The president has also been accused by critics of using his position of power to manipulate the markets with his actions and pronouncements. Mr. Trump has at times appeared to back down from threats in response to sliding markets, a trend that traders have nicknamed TACO — Trump Always Chickens Out.
Mr. Trump also has ties to the prediction market industry. His son Donald Trump Jr. is an adviser to Kalshi and Polymarket, and the Trump family’s social media company last year announced plans for a prediction market service.
Davis Ingle, a White House spokesman, denied that Mr. Trump or any administration official had used nonpublic information for financial benefit.
“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 nonpublic information for financial benefit,” Mr. Ingle said in a statement.
He added: “All federal employees are subject to government ethics guidelines that prohibit the use of nonpublic information for financial benefit. However, any implication that administration officials are engaged in such activity without evidence is baseless.”
Insider trading laws criminalize policymakers’ profiting from insider trading, but with significant loopholes.
Public officials are not, for example, explicitly restricted from betting on prediction markets, which effectively involves wagering on whether a future event will occur. Some wagers have predicted consequential world events, including some as extreme as the possibility of a nuclear war. Polymarket, one of the largest prediction markets, removed a market that traded on the likelihood of a nuclear detonation, amid public scrutiny after the U.S. and Israel began bombing Iran.
Lawmakers are pushing legislation that would bar any public official from placing those bets using nonpublic information they learn in their roles. One bill would impose fines up to $500 or double the profit made on the bet for violations.
CNN reported last month that federal prosecutors have met with Polymarket to discuss how insider trading laws apply to its bets.
Tyler Pager contributed reporting.
Chris Cameron is a Times reporter covering Washington, focusing on breaking news and the Trump administration.
The post White House Warned Staff Not to Engage in Insider Trading Amid War With Iran appeared first on New York Times.
