WASHINGTON/NEW YORK, March 29 - Trades that were placed minutes or hours before major policy moves under the current administration yielded unusually large gains for anonymous accounts, prompting market-watchers and legal experts to say the activity should be examined to protect market integrity and to determine whether privileged information leaked from inside government.
Reviewing several episodes tied to tariff policy, Venezuela and Iran, legal specialists identified at least four notable instances in which the timing and magnitude of the wagers appeared to foreshadow events that moved markets. Those trades spanned multiple instruments and venues, including options on equities, oil futures on the New York Mercantile Exchange - which is owned by CME Group - and bets on prediction markets.
Andrew Verstein, an insider trading expert at UCLA School of Law, said the pattern of trades is troubling. "It looks deeply suspicious," he said, noting that while the number of examples is limited, they are the kinds of patterns one would expect to see if government officials or associates were trading on advance knowledge.
Aitan Goelman, a former enforcement director at the Commodity Futures Trading Commission and an ex-federal prosecutor, said trades of this character typically draw regulatory attention. He cautioned, however, that insider trading law in commodities markets is complex and remains comparatively undeveloped. Exchanges and agencies such as the CFTC and the Justice Department would normally flag such activity as "anomalous and interesting," Goelman said.
White House spokesman Kush Desai said that government ethics rules prevent federal employees from profiting from nonpublic information and warned against drawing conclusions without evidence. "Any implication that Administration officials are engaged in such activity without evidence is baseless and irresponsible," he said in an emailed statement.
Regulatory agencies declined to make detailed disclosures public. A CFTC spokesperson said the agency remains in regular communication with exchanges "over trades that raise red flags" and that the CFTC performs its own surveillance, but did not confirm whether any formal probe has been opened into the specific wagers identified. The Securities and Exchange Commission declined to comment, and the Justice Department did not respond to a request for comment.
Not every timely position reflects illicit knowledge. Some traders simply get lucky, and others may detect market signals that go unnoticed by most participants. The review notes that Wall Street firms increasingly hire former military and national security advisers, which could give institutional desks alternative sources of insight. In addition, some transactions might represent hedges structured to offset exposure elsewhere, a common practice in macro-driven commodities portfolios.
Still, experts say the size and binary payoff of some wagers heighten suspicion. David Rosenfeld, former co-head of enforcement at the SEC's New York office, pointed to the sheer conviction implied by extremely large, event-driven bets. "When you’re dealing with bets on unique events and things like that, those do raise a lot more suspicion that somebody has some specific inside information," he said.
Four specific cases singled out in the review stand out for their timing:
- April 2025 - Tariff pause: Options traders reportedly made multimillion-dollar gains in the minutes before President Trump announced a pause on his blanket "Liberation Day" tariffs, a move that coincided with a 9.5% surge in the S&P 500.
- January - Venezuela: An unidentified Polymarket account, created the month prior, placed more than $30,000 in wagers that would pay out if the United States invaded Venezuela by January 31, and collected more than $400,000 after a bet on the ouster of Venezuelan President Nicolas Maduro paid off that month.
- February 28 - Iran leadership attack: Prediction-market activity ahead of the killing of Iranian Supreme Leader Ayatollah Ali Khamenei included bets on Polymarket and Kalshi that drew scrutiny. Analytics firm Bubblemaps identified six Polymarket accounts that together realized about $1.2 million in profits from positions funded in the hours immediately before U.S.-Israeli military action that resulted in Khamenei's death.
- March 23 - Oil futures: Unidentified traders placed roughly $500 million in oil market positions minutes before President Trump announced a delay in an assault on Iranian energy assets, a move that sent crude prices tumbling. Those trades occurred on the New York Mercantile Exchange.
Experts contend that the combination of timing, size and the binary nature of several wagers warrants inquiry. Aitan Goelman said that while commodities insider trading is legally prohibited, enforcement in these markets is less established than in equities, leaving gray areas in precedent.
Steve Sosnick, chief strategist at Interactive Brokers, emphasized the practical difficulty of tracing such activity given the fragmented regulatory landscape. The implicated trades involve a patchwork of oversight bodies - the SEC, the CFTC - and prediction market platforms, where legal frameworks remain unsettled. "If this was a single actor or a set of cooperating actors, it would require a high level of coordination between a diverse and dedicated group of regulators to get to the root of the issue," Sosnick said. He added that he has seen no evidence that such coordination is underway, and noted that the recent resignation of the SEC's enforcement chief amid reports of internal frustrations makes it difficult to envision regulators elevating this as a top priority.
Prediction markets themselves have taken steps to tighten controls. Both Kalshi and Polymarket implemented new rules in March to curb potential insider trading on their platforms. A Kalshi spokeswoman said the company will continue to "enforce as necessary and iterate on our existing technologies and partnerships," and added that bets the size of the March 23 oil futures transactions would have been flagged if they had been placed on Kalshi's platform.
Polymarket's chief legal officer, Neal Kumar, said in an interview that Polymarket monitors all transactions on its U.S. site in real time and maintains controls that can rapidly address suspicious trading.
Still, the legal and oversight environment for prediction markets is in flux, and academics with experience studying insider trading note the challenges of applying existing statutes to a mix of traditional exchange-traded products and newer, decentralized platforms.
Observers caution that some legitimate explanations remain for the highlighted trades: luck; superior reading of public or semi-public signals; hedging strategies used by sophisticated macro managers; or legitimate market-making and liquidity provision. But the concentration of unusually timed wins across different markets and instruments has increased calls from former regulators and academics for formal reviews insofar as authorities have the jurisdiction and tools to pursue them.
For now, exchanges, regulators and the platforms involved have signaled vigilance. The CFTC said it tracks trades that raise red flags in coordination with exchanges. CME Group, which owns the New York Mercantile Exchange where the oil trades were routed, declined to comment on the specific transactions or whether it was reviewing them. The SEC did not comment, and the Justice Department did not respond to requests for comment. The White House reiterated that ethics guidelines bar profiting from nonpublic information.
The precise origins and motives behind the trades remain unproven in the public record. Legal experts say that while enforcement pathways exist, past action in commodities and prediction market contexts has been limited, and the evolving nature of platforms complicates both detection and prosecution.
As regulators assess whether to open formal probes, market participants and observers will be watching whether exchanges and oversight agencies can reconcile wide-ranging trading data across venues and whether platforms will continue to strengthen transaction surveillance. The stakes include not only the integrity of specific markets such as commodities and prediction exchanges, but also broader investor confidence in how political information is reflected in prices.