In the first month after 9/11, there was rather widespread commentary in the press that persons had made enormous profits from foreknowledge of the attacks. [1]

In 2004, The 9/11 Commission Report wrote: “Highly publicized allegations of insider trading in advance of 9/11” have been made, and there was “[s]ome unusual trading” involving “put options – investments that pay off only when a stock drops in price.” [2] However, the Commission said: “Exhaustive investigations by the Securities and Exchange Commission, FBI, and other agencies have uncovered no evidence that anyone with advance knowledge of the attacks profited through securities transactions.” [3]

For example, “the volume of put options … surged in the parent companies of United Airlines on September 6 and American airlines on September 10,” and this was “highly suspicious trading on its face.” However, “further investigation has revealed that the trading had no connections with 9/11. A single U.S.-based institutional investor with no conceivable ties to al Qaeda purchased 95 percent of the UAL puts on September 6 as part of a trading strategy that also included buying 115,000 shares of American on September 10.” [4]

There are three reasons to reject the 9/11 Commission’s claim that it refuted the belief that huge profits were gained through foreknowledge of the 9/11 attacks.

First, the 9/11 Commission did not show that there was no insider trading based on foreknowledge about the 9/11 events, but simply asserted this.

Second, the Commission used a circular argument with regard to United Airlines: In stating that most of the United Airlines put options were purchased by an investor “with no conceivable ties to al Qaeda,” the Commission simply presupposed that 9/11 was planned and executed solely by al-Qaeda and that no one else had any advance knowledge of the attacks.

Third, econometricians – who use statistical analyses to produce objective results in economics – have published studies showing the occurrence of very unusual trades shortly before 9/11 that ensured high profits, thereby revealing high probabilities of insider trading.

• For example, an analysis of the purchases of put options on United and American Airlines between the 5^th and 10^th of September 2001, carried out by a University of Illinois professor of finance and published in a well-established journal, concluded that the evidence was “consistent with the terrorists or their associates having traded ahead of the September 11 attacks.” [5]
• Another econometric study published in a well-respected journal concluded that “abnormal trading volumes … provide credible circumstantial evidence in support of the insider trading claim.” [6]
• A more comprehensive study, by professors at the Swiss Finance Institute and the Swiss Banking Institute, [7] shows that 15 million dollars were likely obtained by insiders using put options for Boeing, Merrill Lynch, J.P. Morgan, Citigroup, and Bank of America stocks. [8]

These econometric investigations, which appeared in 2006, 2010, and 2011, have not been challenged in any professional or governmental responses.