The Biggest Insider Trading Case in American History?

Published by John Polonis on April 11, 2025April 11, 2025

Shortly after pausing tariffs on most countries for 90 days, President Donald Trump held an Oval Office meeting where he congratulated two friends on how much money they had made that day. The stock market had skyrocketed following Trump’s tariff pause announcement. Trump said that it was “not bad” that one guy made “$2 1/2 billion” and the other “$900 million.” This came after a volatile week in financial markets where average people saw the value of their 401(k)s plummet and small businesses struggled to assess global supply chains.

The bigger question is: how did Trump‘s friends make such massive gains on the same day Trump announced a temporary pause on tariffs? Were they tipped off?

A spike in call options trading activity shortly before the temporary tariff pause announcement indicated that someone likely knew what was coming. In my time as a compliance officer on Wall Street trading floors, those situations are rarely coincidences. Traders don’t just get “lucky” on bets that big.

Yet, almost nobody in the mainstream media is covering it. Where is the pressure for Congress to investigate potential insider trading emanating from the White House? Martha Stewart was imprisoned for far less (she avoided a $51,000 loss by selling stock where she had inside information).

Let’s review this potential insider trading case by assessing each element of the crime and applying what we know of the facts. You be the judge of whether this warrants investigation, while keeping in mind Trump’s history as the first meme coin President.

Material Non-Public Information: Did Trump Make It Public?

Some people argue that Trump made it known to the world what his plans were about three hours before the official tariff pause announcement:

This post, however, had no details. We were still in a high tariff environment when Trump “truthed” this message, which could mean that he thought tariffs were working. After all, that was the goal, right? Impose tariffs, reorient markets to that reality, and bring back American manufacturing.

It’s a stretch to argue that this was his public notice that tariffs were being paused. There was nothing in this message or any other communication that even hinted that he was pausing tariffs.

Therefore, it’s safe to conclude that news about the tariff pause was non-public before Trump’s formal announcement.

For information to be “material” it must reasonably affect an investor’s decision to buy or sell securities. Given the effects tariffs had on markets during the prior week, where they spiked volatility and cratered everything from stocks to even bonds, it’s also safe to conclude that news of pausing the catalyst of this chaos is “material.”

Breach of Fiduciary Duty: Does the President Have a Duty to the American People?

All government officials who take the oath of office have a fiduciary duty to the American people. The President arguably has the greatest duty as the single head of the Executive Branch. They owe a duty of trust to the public because the public entrusts the President to lead.

If the President shared material non-public information about a major policy decision with someone who then traded securities, the President could be liable as the “tipper” if the President also received a personal benefit from sharing the information (this can be intangible, whether reputational, a gift to a friend/relative, etc.).

Unfortunately, we cannot access information on whether Trump may have breached this duty unless someone subpoenas his brokerage account statements and those of the people in his orbit. If someone close to Trump (or Trump himself) was behind the call options I highlighted, that would make for a compelling insider trading case against the President, whereas the inverse would relieve him of culpability.

Donald Trump’s Intent Matters

One of the hardest elements in any insider trading case is intent, or as lawyers call it, “scienter.” Without direct evidence — a smoking gun — that clearly shows Trump’s state of mind, investigators and prosecutors have to build a circumstantial case by piecing together evidence.

This piecing together helps construct Trump’s state of mind during the time in question. We have a few pieces of evidence that potentially reveal Trump’s intent:

• The erroneous tariff pause leak — Two days before issuing the formal tariff pause, an almost verbatim leak of the same plan was released on social media. While there’s no public evidence that Trump’s team was behind it, it’s a shocking coincidence that the same 90-day tariff pause plan was publicized some 48 hours before the real one was issued. Almost as if it was a test run to see how markets would react (they briefly soared on Monday before falling once it was confirmed that the news was fake).
• Trump’s Truth Social post — As highlighted earlier, Trump wrote that it was a “great time to buy” three hours before pausing tariffs. He signed the post, “DJT” (his initials), which he doesn’t normally do. There are a few theories here — (i) he wanted to calm volatile markets to help his tariff strategy, (ii) he was tipping the public that a tariff pause was coming, or (iii) he was basking in the power he held over markets and having fun knowing exactly what was about to happen (i.e., his tariff pause). I tend to think it was (iii) because he gave no details in his post about a tariff pause but did indicate he knew how much influence he was about to have on global markets (establishing knowledge/intent that he was about to move markets positively with his upcoming announcement).

Intent is the hardest element to prove and can only really be established through a full investigation. The relevant trading activity alone should warrant one.

Securities Transactions: a Flurry of Call Options Betting on a Big and Positive Market Move

The final element of a criminal insider trading case is that it must involve securities transactions. The classic example is the Gordon Gekko-style tipping off to an accomplice (or friend) of a non-public merger or acquisition before it’s announced. That accomplice typically buys stock in the target company ahead of the announcement, and if they really want to maximize gains, they buy call options in the target company. These are bets that a stock will reach a certain strike price, affording you the option to buy.

Call options are the financial instruments at issue here. One or more people placed call option bets on SPY (an ETF that tracks the S&P 500) and QQQ (an ETF that tracks the NASDAQ) shortly before the tariff pause was announced. These are just two examples of suspicious trading activity that I found (there may be more). Take a look at these charts:

A few points to consider:

1. The call options are short-dated. They were dirt cheap when they were purchased just ahead of Trump’s tariff pause announcement at 1:18 PM EST. The fact they were short-dated is a tell, especially for the first chart (SPY). The SPY options were zero-dated, meaning that people were betting on the S&P 500 to significantly increase that same day. Otherwise, their options would expire worthless. The QQQ options had more time built in (expiring April 17th), but were still very short-dated in an options market that usually trades in months-long increments.
2. The timing for when the orders were placed also looks suspicious. There’s an argument that the QQQ trades were placed when Trump posted “great time to buy” around 9:37 AM. But the SPY trades were placed minutes before the tariff pause announcement later that afternoon.
3. The green bars on the charts are not luck — they are likely prior knowledge. Nobody in their right mind was betting that heavily on major stock market indexes rising. Markets were in terrible states of uncertainty, with stocks down and bond yields rising (suggesting heavy selling in U.S. Treasuries). Traders generally don’t get lucky on market moves of that size and with that type of fortuitous timing.
4. The profits were tremendous. As Trump said himself in the recorded meeting with his friends shortly after the tariff pause announcement, “not bad” profits. A $100,000 bet, for example, would have turned into approximately $21 million in a matter of seconds.

Whether Trump was involved or not, this trading activity alone demands scrutiny. The U.S. Securities and Exchange Commission regularly reviews suspicious options and securities transactions around big events. They keep lists of deal teams from investment banks and their clients to look for possible relationships those people might have with suspicious trades ahead of big market news events.

Why should this situation be any different? If anything, it’s far more serious than a typical merger, acquisition, or corporate event that may move markets. We are talking about one of the biggest economic policy decisions in recent decades. And there was substantial trading activity in front of it.

Where Do We Go From Here?

Unfortunately, I’m not confident that anything will come from this activity. Trump has shown time and again a willingness to look the other way when people who support him commit crimes. The most recent example of this was his pardoning of Trevor Milton, who infamously rolled an electric truck manufactured by his startup, Nikola, down a hill to make it appear to investors that it worked (when it didn’t). Milton had donated some $1.8 million to Trump’s 2024 campaign.

Anyone in Trump’s orbit is unlikely to face punishment for potential insider trading, whether it’s the guys laughing about the money they made ahead of the tariff pause announcement or anyone else with a connection to him. So long as they remain loyal to Trump, they don’t risk prosecution. They fall in the “I can shoot someone on 5th Avenue and get away with it” bucket.

This doesn’t mean we shouldn’t speak out, however. It doesn’t mean we shouldn’t pressure our elected officials to investigate what appears on its face to be insider trading.

I can assure you that had you or I engaged in that activity, we wouldn’t be sipping champagne or Diet Coke at Mar-a-Lago. We would be in prison.