This article originally appeared on PolitiFact.
A social media post, followed by a market-moving tariff announcement, led President Donald Trump’s critics to speculate that he might have profited from inside information.
At 9:37 a.m. ET on April 9, after a nearly 20 percent downturn in key market indexes, Trump posted on Truth Social, “THIS IS A GREAT TIME TO BUY!!! DJT.”
Then, at 1:18 p.m., Trump announced a 90-day pause in country-by-country tariffs he had unveiled a week earlier. While Trump did not lift the nearly universal 10 percent tariffs or country-specific tariffs on Mexico, Canada and China, his reprieve on some tariffs produced a stock market boom for the rest of the day.
WATCH: Trump pauses many of his tariffs but raises rate on China
The S&P 500, a broad stock market index, climbed 9.5 percent by the close of trading April 9, a sign that investors were relieved at the tariff backtracking. Trump’s own company — with the ticker symbol DJT — rose by roughly twice that percentage on April 9, raising Trump’s net worth by an estimated $415 million in one day.
On social media, users posted a video taken inside the Oval Office showing Trump celebrating the stock market’s gains.
“He made $2.5 billion today and he made $900 million — that’s not bad,” Trump says in the clip, referring to two other men in the room. The caption on one of the X posts sharing the video and Trump’s comments said, “Sounds like market manipulation to me.”
News outlets reported that one of the men was Charles Schwab, founder and chairman of the eponymous financial services firm.
Democratic lawmakers also took issue with the timing.
“An insider trading scandal is brewing,” Sen. Chris Murphy, D-Conn., posted on X. “Trump’s 9:30am tweet makes it clear he was eager for his people to make money off the private info only he knew.”
On April 10, Democratic Sens. Ruben Gallego of Arizona and Adam Schiff of California wrote a letter to the Office of Government Ethics, an executive branch watchdog, to “request an urgent inquiry into whether the President, his family, or other members of the administration engaged in insider trading or other illegal financial transactions.”
Sen. Bernie Sanders, I-Vt., said April 9 at a CNN town hall, “If you know two hours earlier that the stock market’s going to go (up), what are you going to do? You’re going to buy a hell of a lot of stock.”
PolitiFact received several reader inquiries asking about Trump’s actions.
Legal and financial experts downplayed the idea that Trump’s message ran afoul of the law.
“The federal case law on insider trading is fatally ambiguous,” said Kevin R. Douglas, a Michigan State University law professor.
In a statement, White House spokesman Kush Desai said, “It is the responsibility of the President of the United States to reassure the markets and Americans about their economic security in the face of nonstop media fear mongering. Democrats railed against China’s cheating for decades, and now they’re playing partisan games instead of celebrating President Trump’s decisive action yesterday to finally corner China.”
What is insider trading?
Insider trading occurs “when individuals make stock trades using non-public information that came into their possession through a relationship of trust and confidence,” said Sarah J. Williams, a Penn State Dickinson Law School professor.
A related offense is market manipulation, such as a “pump and dump” scheme in which a stock promoter makes false or misleading statements to drive up the price of a stock, then sells personal holdings at the falsely inflated high price.
In theory, insider trading statutes “cover people in the executive branch, expressly including the president,” said Allan Horwich, a Northwestern University emeritus law professor.
Still, securing a conviction tends to be difficult, no matter who is being prosecuted.
“These cases are often proven by circumstantial evidence,” and that’s hard to do in criminal prosecutions “because proof must be beyond a reasonable doubt,” Horwich said.
Williams agreed: “Proving that non-public information was used — as opposed to the use of analysis performed on publicly available information — and that it motivated the illegal trades can be challenging.”
Why Trump might not have to worry much about legal exposure
Legal experts cited several reasons why Trump’s April 9 actions are unlikely to give him legal troubles.
He posted information publicly. We can’t know what Trump said to others privately. We do know, though, what he said prior to the tariff-pausing announcement — because it was public, not only for his 9.4 million followers but for any one else who wanted to see it.
“Generally, if information is made public promptly, there is no room for insider trading issues, which by definition involve misuse of nonpublic information,” Horwich said. “I don’t see how a public recommendation to buy — what stock? or was it bonds? at what price? to buy a broad index? — implicates the law of insider trading.”
Who investigates insider trading? For a typical insider trading allegation, the Securities and Exchange Commission and the Justice Department would typically investigate and prosecute violators, experts said. Both are part of the executive branch, which under the Trump administration has been tightly controlled by the White House, making any prosecution of the president unlikely.
Trump’s only other potential risk could come from private lawsuits. “Individuals who are innocently trading in a particular stock at the same time the illegal insider trading is occurring are authorized by statute to sue the inside trader,” Williams said.
A potential plaintiff might need to argue that Trump gave advance notice to people in private, which would be hard to substantiate.
Presidents have a lot of latitude. Nejat Seyhun, a University of Michigan finance professor, said it would be a “high” bar to prove Trump did something illegal in this case.
Trump “can easily say that the market has fallen 20 percent, and I want to make sure that panic does not become self-fulfilling,” Seyhun said. Trump could also argue that his remarks in his post were an official presidential act, which the Supreme Court last year decided qualifies for protection from prosecution.
Trump could also say, “At the time I sent this, I had not fully made up my mind yet” about pausing tariffs, Seyhun said.
Ultimately, any president in this situation would have some protections owing to their unusual position. “Presidents make statements that move the market all the time,” Seyhun said.
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