Questions about 9/11 Insider Trading
29 2016-03-21 by daddie_o
I have been trying to track down information regarding the suspicious trading pre-9/11. I am trying to piece things together, but there are a few questions that I'm having trouble finding reliable answers to on the web, so I figured this would be a good place to get answers. I will summarize what I understand, followed by questions:
As I understand it, many of the options were traded by Deutsche Bank Alex Brown ABB on the Chicago options exchange.
Do we have a good idea of what percentage of suspicious trades went through this bank? I have seen 'all,' 'most' and 'some' on various websites.
What other trading companies were implicated?
As I understand it, the banks act as an intermediary between the buyers and sellers of put/call options, in which case Deutsechbank was not the one putting in the orders.
- So do we know who was actually placing/buying the put options?
The investigation is what I'm most unclear about. The FEC "investigated" and concluded that there was no reason to suspect that the trades were a result of people trading on insider information. The 9/11 commission says the institutional investors involved have no conceivable ties to terrorism (though it does not name them). Elsewhere I read that in its investigation, the FEC deputized people in the industry to help them gather information, which meant that those people could not publicly disclose what they knew without breaking the law and fear of reprisal (I don't know if that last part is true).
Is it possible, in principle, for the FEC to get information on the investors who bought the suspicious put/call options and not just the banks that acted as a conduit?
Assuming it is possible, what is their excuse for not having done so?
Is it related to the destruction of FEC computers in WTC7?
If not, what is the "conspiracy theory" about the incentive to destroy those computers? Cui bono?
If anyone knows of a good resource where the answers to these questions are laid out, I'd appreciate it. Thanks to those of you who take the time to answer some or all of these questions.
EDIT: Here are citations to the 3 peer-reviewed studies about 9/11 insider trading that have been published in finance journals:
Poteshman. 2006. "Unusual Option Market Activity and the Terrorist Attacks of September 11, 2001". The Journal of Business, 79(4):1703-1726.
Wong Et Al. 2011 "Was there Abnormal Trading in the S&P 500 Index Options Prior to the September 11 Attacks?" Multinational Finance Journal 15(2):1-46.
Chesney Et Al. 2015. "Detecting abnormal trading activities in option markets." Journal of Empirical Finance 33:263-275.
EDIT 2: THANKS EVERYONE FOR ALL THE HELPFUL REPLIES!!! I also found this rather informative roundup by Lars Schall: http://www.globalresearch.ca/insider-trading-on-911-speculative-trade-in-put-options-the-financial-facts-laid-bare/5476100
22 comments
3 Cecilia_Tallis2 2016-03-21
A few weeks ago I was listening to a podcast and they spent quite some time on this topic.
Since then I have had surgery and my brain is fuzzy.
I will try and find it and post the link.
This is a topic I'm interested in as well.
A German company called Convar recovered data from hard drives damaged in the collapse. There has been a lot of speculation about that.
3 [deleted] 2016-03-21
Destroying WTC7 had no public relations purpose for the Bush Syndicate. At 47 stories, most people were not even aware that it existed. Yet within WTC7 were many government offices including the FBI, CIA, SEC, Justice Department, and Secret Service. WTC7 was also the storage facility for millions of files pertaining to active cases involving international drug dealing, organized crime, terrorism and money laundering. By destroying WTC7, the Bush Syndicate was able to stop many criminal investigations that would have led to high level members of the criminal cabal embedded within the US government. The need to avoid prosecution for previous crimes may have been one of the largest motivations for the 9/11 attacks. These investigations included: WTC building 6 housed the U.S. Customs agency and the El Dorado Task force an interagency group founded in 1992 which coordinated all major money laundering investigations in the U.S. [37] An FBI investigation into gold price fixing / gold laundering housed on the 22nd floor on North Tower in the WTC.[38] An FBI case against Mobil Oil and James Giffen on illegal oil swaps between Iran and Kazakhstan at that time before a NY grand jury. ( see July 9th Seymour Hersh article, http://www.newyorker.com/archive/2001/07/09/010709fa_fact_hersh). Bank of New York money laundering: evidence in buildings 1 and 7. 3 agencies involved in the Enron investigation (SEC, Justice Department, and FBI)- In WTC7, the IRS was investigating Barrick Gold’s offshore hedge book.[39] 3,000 – 4,000 cases at the SEC office including documents showing the relationship between Citigroup and Worldcom.[40] Instead of flying straight over the Potomac and into the offices of the Joint Chiefs of Staff and the Secretary of Defense, American Airlines flight 77 executed a very difficult 330 degree descending corkscrew turn to crash into the section of the Pentagon containing the Office of Naval Intelligence and pentagon budget analysts. The Office of Naval Intelligence had just been moved into the section of the Pentagon which was destroyed on 9/11. At that time, the Office of Naval Intelligence was investigating a gold price fixing/gold laundering scheme that could have implicated the Bush Syndicate. Also killed in the Pentagon on 9/11 were a large number of budget analysts and accountants who may have been looking into the $2.3 Trillion of unaccounted military spending that Donald Rumsfeld announced on Sept 10th, 2001. In addition, after 9/11, many government investigators who previously had been looking into domestic government criminal activity were diverted from those cases to the newly created war on terror. As a result of both the destruction of ongoing investigations and the diversion of resources, all investigations which threatened criminals embedded within the highest levels of the U.S. government were stopped. 9/11 as a massive financial crime: The criminal syndicate behind 9/11 also used the “terrorist attacks” as cover for a series of financial crimes. These crimes are less well researched than many other aspects of the 9/11 op, and I suspect that we will have continuing revelations on this front. The best documented aspect of the financial crimes has been the widespread insider trading which took place prior to the 9/11 attacks. Jonathan Winer, a financial consultant, told ABC, “it’s absolutely unprecedented to see cases of insider trading covering the entire world from Japan to the US to North America to Europe.”[41] After the 9/11 attacks, the German Central bank studied the possibility of insider trading. According to German central bank president Ernst Welteke, the German researchers found “almost irrefutable proof of insider trading”.[42] Welteke was blunt: “What we found makes us sure that people connected to the terrorists must have been trying to profit from this tragedy.”[43] Some of the unusual trading in put options was conducted by Deutsche Bank Alex Brown whose CEO “Buzzy” Krongard had longstanding ties to the CIA and left Alex Brown in March 2001 to become Excecutive Director of the CIA. However, the SEC was not forthcoming about its own investigation “treating these inquiries as if they were state secrets”. The SEC quickly concluded that there was no insider trading and in a highly unusual move destroyed all of its records of the investigation.[44] In addition to insider trading, other sophisticated financial frauds were part of the 9/11 op. Convar, a company specializing in computer disaster recovery found evidence that “unusually large sums of money, perhaps more than $100 million, were rushed through the computers [in the WTC] as the disaster unfolded." A Deutsche Bank employee told investigative reporter Mike Ruppert that “about five minutes before the attack the entire Deutsche Bank computer system had been taken over by something external that no one in the office recognized, and every file was downloaded at lightning speed to an unknown location”.[45] The details of what happened in the bond market are not completely clear, but there appears to be strong evidence that a major financial crime was committed, perhaps the largest theft in US history. It is also possible that there is a benign explanation for the following set of facts, but given the level of sophistication and comprehensive nature of the Bush Syndicate, the benign explanation strikes me as unlikely. The targeted nature of the airplane strikes appears to have been a deliberate attempt to cause chaos in the US government bond market. The plane which hit the North Tower of the WTC crashed right into the offices of Cantor Fitzgerald, the largest inter-dealer broker of U.S. government bonds. While in the South Tower, the offices of Eurobrokers, another large inter-dealer broker, were in the impact zone of the second plane strike. In the wake of the “chaos” in the bond market, the regular rules for settling trades were suspended, and the conditions for a huge financial crime were created. Trade breaks are a regular occurrence in the financial markets, and standard procedures exist to allow for the nullification of trades without a counterparty. However, in the days following 9/11, rather than use the established procedures for dealing with unmatched trades, in an unprecedented action, the SEC suspended normal rules and allowed for blind brokered trades. Despite the damage to lower Manhattan, the fixed income clearing operations of most banks were unaffected, but in the days following September 11, Bank of New York was overdue on over $100 billion in payments.[46] However, none of BoNY’s systems failed or went non-operational. As the New York Times reported, “Bank executives argue that some of the criticism has taken on some aspects of urban legend, especially the notion that the bank was in disarray because the main backup for its computer center in Lower Manhattan was at another location in Lower Manhattan. The bank says that all of its several computer centers in Manhattan were always set to revert to centers outside the city in case of emergency, and they did on Sept 11.”[47] September 11, 2001 was no ordinary day for the financial markets. By mid-morning, all of lower Manhattan, including the financial district had been evacuated. Across the country, business slowed as people put their normal lives on hold to either react to the attacks or just watch the events unfold on TV. As a result, both the number and volume of transactions sending funds through the financial system was much lower than average throughout the day of 9/11. However, starting around 6 PM and continuing to midnight, a huge amount of money started flowing through the banking system. Although many billions of dollars were flowing through the system, this large flow of funds was handled with only a small number of transactions.[48] What really happened in the financial markets in the days following 9/11 is hard to know, but evidence exists of: highly unusual trade flows, an unprecedented suspension of the normal rules for processing trades, massive, coordinated insider trading that was covered up by the SEC, an incredibly sophisticated black op run by people with a history of running financial frauds, a computer systems take over at Deutchebank, and a $100B plus trade settlement problem at BoNY blamed on systems problems yet BoNY never had any systems problems. Given the lack of any investigation into these possible financial crimes, not enough evidence exists to form a clear opinion as to what happened, but the above pattern of facts is consistent with a massive $100B+ financial crime as part of the 9/11 op.
2 daddie_o 2016-03-21
THANK YOU!!!
2 [deleted] 2016-03-21
I stand on the shoulders of other's ...
Make sure u check out that link https://wikispooks.com/wiki/Document:Fifty_Years_of_the_Deep_State
That paragraph was downvoted and ignored, so you know it's on to something...
1 daddie_o 2016-03-21
Thanks. I'm going to look into all of them, downvotes or not!
1 [deleted] 2016-03-21
Here's some comic relief
http://youtu.be/OdbknSpnt2A
Donny Rumsfeld
3 ShellOilNigeria 2016-03-21
If you have not already familiarized yourself with History Commons, it is a good resource -
http://www.historycommons.org/timeline.jsp?timeline=911timeline&911timeline_before_9_11=911timeline_insider_trading__foreknowledge
2 [deleted] 2016-03-21
[deleted]
1 Cecilia_Tallis2 2016-03-21
Thanks for sharing this. It was a good watch.
1 [deleted] 2016-03-21
[deleted]
2 Cecilia_Tallis2 2016-03-21
Very informative and I liked how it used the actual news reports.
2 99scolglaz 2016-03-21
There are hundreds of thousands of Equity options trades done daily. In hindsight numerous allegations (all likely spurious) and connections can be made and drawn.
http://www.cboe.com/data/avgdailyvolarchive.aspx
2 Apoplecticmiscreant 2016-03-21
I believe it was a Christopher Bollyn video I was watching fairly recently said the evidence for who collected, was destroyed. Naturally.
5 jacks1000 2016-03-21
I've read the SEC destroyed the data as part of "routine record keeping."
I've also read some of the trading was traced to Buzzy Krongard, CIA.
3 Apoplecticmiscreant 2016-03-21
It's always sooo routine, innit?
3 Cecilia_Tallis2 2016-03-21
They traced some to Wirt Dexter Walker III (distant relation to the Bush fam) and his wife. But since they had no ties to Al-Qaeda it wasn't seen as relevant.
It is talked about in this link that /u/monkey-see-doggy-do posted....
https://www.youtube.com/watch?v=n3xgjxJwedA
2 Apoplecticmiscreant 2016-03-21
...and yet people don't think there was a conspiracy. The real culprits are alive and well and enjoying their lives. Enriched by the blood of the innocent.
2 Cecilia_Tallis2 2016-03-21
The report admits there was insider trading but it's not "Al-Qaeda"...so that's OK.
How anyone can be OK with that and think that is not a conspiracy....I just really don't know what to say anymore.
Very sad and very true.
2 Idiocy_or_Treason 2016-03-21
Did you watch Billions yesterday? Rolled my eyes last week about everyone in the show being upset about shorting AA after the plane hit. Who wouldn't do That? Or pull their money out, it's the reason they shut down Wall street for three days. It's the shorts prior to the attacks that should be checked. Or who sent the text message to odigo in tel Aviv warning about the attacks. Odigo also had offices in the towers in New York, making it even weirder.
2 tttggg333 2016-03-21
Here's a great explanation from someone who witnessed it first hand: https://www.youtube.com/watch?v=bFJwVxqD4A4
2 NoelTrotsky 2016-03-21
Looks like you are searching for the conspiracy side of the official story on the pre-9/11 trading scandal. If you haven't already I'd suggest reading Rupert and Flocco here, http://www.fromthewilderness.com/free/ww3/10_09_01_krongard.html
http://www.fromthewilderness.com/free/ww3/12_06_01_death_profits_pt1.html
It's a huge read but I'll pull out some stuff you're asking about.
The first link shows there were lots of suspicious puts placed in the days prior to 9/11. No idea the number of trading companies involved although I did hear British regulators were also involved which might put some British traders in the mix. You would have to track down the writer of the IDC story that started it or the SFGate story writer here might know which institutions were involved. http://www.sfgate.com/news/article/Suspicious-profits-sit-uncollected-Airline-2874054.php The problem is you have lots of simple traders putting in a few puts all over the world. The big money seems to be located at Deutsche with Brown.
I hope you find some names for other traders involved, however digging into A.B.Brown probably leads you far enough down the rabbit hole. A.B. “Buzzy” Krongard ran it then moved over to be executive director at the CIA. The reinsurance trades look like the CIA profiting at the expense of Euro insurance companies on a CIA planned 'terrorist' event. That involved huge money. The few little airline puts sounds like some small 'in the know' fish making a few bucks. Of course some were never collected on.
Trading companies typically know who their clients are that hold accounts and make put options. In fact it's generally law that they do to stop money laundering. I haven't seen anyone identified in any story anywhere...no surprise of course.
In financial investigations people are deputized routinely because the investigations are so complex authorities have no idea how to dig around and find the guilty. They are not allowed to discuss the investigation otherwise it would ruin any future prosecution of the targets. Standard stuff really.
My thoughts on your questions:
The FEC is limited to US territorial investigations. They can request help internationally, but banks outside of the FEC's reach make the investigations much more difficult. So investors in Germany, making a trade through a German bank in a US stock exchange need to be prosecuted in Germany. The SEC would provide evidence of insider trading to Germany. Of course Germany would share their investigation details with the SEC so they could search their 'system' for individuals involved working through other banks or trading companies.
The few millions made off of the US airline trades isn't really that much and it is so easy to defend insider trading cases like that. Always hearing normal news that might impact airline stocks. Chance of a conviction so small and the publicity generated by that story would be massive.
I don't think it's related to the FEC losing some computers in WTC7. The info would have been backed up off-site. Interestingly there seems to have been a spike in last second credit card transactions through some computers inside WTC7 in the hopes the data was lost in the disaster. http://www.foreignpolicyjournal.com/2013/02/23/re-deutsche-bank-alex-brown-and-911-insider-trading/ That doesn't seem related to the SEC however as it was credit card companies restoring some hard drives.
Tons of precious info inside WTC7 to destroy. I've read some theories but they are all over the place. I doubt you'll ever get anything but speculation on this subject.
1 daddie_o 2016-03-21
THANK YOU!!!
2 Cecilia_Tallis2 2016-03-21
Here is the link...
https://m.soundcloud.com/guns-and-butter-1/evidence-of-insider-trading-before-911-paul-zarembka-245
Zarembka is also author of "The Hidden History of 9/11"
1 [deleted] 2016-03-21
https://wikispooks.com/wiki/Document:Fifty_Years_of_the_Deep_State
2 [deleted] 2016-03-21
I stand on the shoulders of other's ...
Make sure u check out that link https://wikispooks.com/wiki/Document:Fifty_Years_of_the_Deep_State
That paragraph was downvoted and ignored, so you know it's on to something...