Insider trading: Is Trump involved in a Harshad Mehta-like scam? He would have made a fortune minutes before his statements!
Trump Insider Trading: Donald Trump often makes major announcements, earning his supporters millions of rupees. Trump's statements have a profound impact on the market, leading to insider trading.
What is the game of insider trading?
The year 1992... You all likely remember India's biggest financial scam. When Harshad Mehta of Gujarat shook the banking system and stock market, committing a scam worth nearly ₹5,000 crore through insider trading. Similarly, some allegations are also being leveled against US President Donald Trump
Question 1: What is insider trading and why is it considered illegal?
Answer: Insider trading refers to trading stocks, futures, options, or other securities using confidential, non-public information that is not known to the general public. For example, prior knowledge of an important government announcement, such as a war decision or tariff policy, and placing bets based on that information. This is illegal because it benefits those with insider information, while ordinary investors suffer losses. This creates unfairness in the market and erodes investor confidence.
In the case of Trump, trading often spikes shortly before his statements are made public. Experts consider this a sign of illegal insider trading, meaning that certain individuals have prior access to confidential information that the common man doesn't have. This earns them billions and billions of rupees, while the common man suffers losses.
Question 2: What major examples of Trump and insider trading have come to light?
Answer: According to a BBC report, there is a clear trading pattern prior to Trump's announcement. Here are five key examples:
1. March 9, 2026: 'The war is almost over' on the Iran war.
Trump stated in a phone interview with CBS News that the conflict with Iran was almost over. The public learned of this at 19:16 GMT, when the reporter posted on X, but bets on oil futures had increased 47 minutes earlier, at 18:29 GMT. As a result, oil prices fell by 25%. Traders who had engaged in short selling made profits worth millions of dollars.
2. March 23, 2026: 'Full and Final Resolution' with Tehran
Trump posted on TruthSocial that hostilities between Washington and Tehran had been completely resolved. The post appeared at 11:04 GMT, but heavy oil bets had already been placed 14 minutes earlier (10:48-10:50 GMT). As a result, US oil prices fell 11%. According to some reports, trades worth approximately $580 million (approximately Rs 4.66 thousand crore) occurred during this time, resulting in significant profits for some traders.
3. February 28, 2026: US bets on an attack on Iran.
Blockchain analysis site BubbleMaps revealed that six new accounts suddenly appeared in February. All of them placed heavy bets on an attack on Iran. When Trump confirmed the attack, these accounts earned a total of $1.2 million. Five of the accounts were never active again.
4. January 3, 2026: Venezuelan President Nicolas Maduro's case:
A new account named 'BurdenSome-Mix' was created on online prediction markets like Polymarket in December 2025. From December 30 to January 2, it bet $32,500 on Maduro's resignation. Maduro was removed from office on January 3. The account won $436,000 and immediately changed its username and became inactive.
5. April 2-9, 2025: (Liberation Day Tariffs and 90-Day Ceasefire)
On April 2, 2025, Trump announced heavy tariffs on imports from around the world, sending stock markets plunging. However, a week later, on April 9, he announced a 90-day tariff pause for all countries except China. This announcement sent the S&P 500 index soaring 9.5%, the biggest gain since World War II. Trading data shows that heavy bets were placed on the stock market's sudden rise after 18:00 BST, coinciding with Trump's announcement at 18:18 BST. This surge generated profits of approximately $20 million for some traders.
Nobel Prize-winning economist Paul Krugman alleged in March 2026 that Trump's close associates made billions by exploiting insider information in the crude oil market.
Question 3: So is Trump really the mastermind of insider trading?
Answer: Some analysts consider this a clear sign of insider trading because the timing of trading and the matching of confidential information seem suspicious, but others say traders have become accustomed to Trump's unpredictable style and are taking positions in advance. Nevertheless, the pattern has become so repetitive that calls for an investigation have increased.
The US Commodity Futures Trading Commission (CFTC) has launched an investigation into oil futures trades prior to the March 2026 Iran policy shift (March 23 and April 7). Trades on the CME Group and ICE platforms are being investigated. Some senior Democratic lawmakers have written to the Securities and Exchange Commission (SEC) demanding an investigation. The White House has warned staff against insider trading, but no concrete evidence or arrests have yet been made.
Question 4: What impact is this having on common investors and the market?
Answer: The biggest impact of insider trading is the loss of market equity. A select few traders receive confidential information before Trump's announcement, allowing them to place large bets minutes or hours in advance. This raises questions about market transparency and fairness.
The public believes the market is already predetermined. Big players are playing with insider information, while small investors simply suffer losses. This destroys market parity. Such patterns undermine investor confidence, as they feel they don't have a level playing field.
The overall impact on the market is increased volatility. Sudden swings in both oil and stocks have increased volatility, which in turn impacts the economy, inflation, oil prices, corporate shares, and even the common man's wallet.
Experts say that even if insider trading isn't always proven, the mere appearance of it is enough to erode investor confidence. The market has become more risky for small traders, leading many to stay away or become cautious.
Question 5: What could happen next in this case?
Answer: There has been no concrete evidence or arrests yet, but the investigation has intensified. The US Commodity Futures Trading Commission (CFTC) has launched an investigation into oil futures trades prior to the March 2026 Iran policy change. The investigation is focused on trades conducted on the CME Group and ICE platforms, where trades worth millions of dollars occurred minutes in advance.
CFTC Chairman Michael Selig stated clearly in a congressional committee on April 16, 2026, “Anyone who engages in fraud, manipulation, or insider trading, we will find them and bring the full force of the law to justice.” He explained that the CFTC has hundreds or thousands of ongoing investigations, and insider trading is now its top priority.
Experts predict legal action if evidence is found, but ESSEC Business School professor Paul Oden says this is very difficult to prove. If financial authorities can't determine the source of the information, they won't prosecute. Nevertheless, the pattern is clear enough to warrant further congressional hearings and the creation of new regulations. If the investigation finds anything wrong, political pressure on the Trump administration will increase.