As US soldier is charged for alleged Maduro bets, SEC conducts strikingly low-key probe of futures and prediction markets
Federal prosecutors in Manhattan late Thursday announced stunning charges against an Army officer who allegedly traded on classified info involving the US military operation to capture former Venezuelan strong man Nicolás Maduro – netting $400,000.Meanwhile, the Securities and Exchange Commission has taken a much quieter approach to a surge of suspicious trades in the futures and prediction markets.The legal community believes the SEC is probing well-timed, high-dollar trades that have lately capitalized on surprise news developments, though the details remain murky.One well-connected securities lawyer who regularly deals with the commission says Chairman Paul Atkins is keenly interested in fair markets and sees potential insider trading as something that erodes trust among members of the investing public.As a result, the attorney said, the SEC has launched what she believes is a formal investigation into the matter that includes requests for information from some market players.Futures trading activity, the attorney noted, is easily tracked through exchanges like the CME.The DOJ has also been meeting with officials from the prediction markets, where other well timed bets are taking place, the source added.“They know who to ask to get to the bottom of this issue,” she said.But another securities lawyer who specializes in high-profile insider trading cases, also speaking on the condition of anonymity, said he’s heard nothing to indicate that the SEC’s interest in the matter is major, or that the DOJ is mounting an aggressive case..“I would usually hear through the rumor mill that something is of significance, but it’s been silent,” the person said.The SEC, of course, doesn’t comment on such matters, and it’s difficult to gauge its interest in anything from sources one step removed from the investigative process.
A spokesman didn’t return a request for comment. The SEC’s sister agency, the Commodity Futures Trading Commission, which has fron...