FBI: No profiteering from 9/11 attacks
Just before 9/11-01, there was a suspicious spike in the volume of trading in airline stock options, and somebody made big money from the disaster. Did people with deep connections to al-Qaeda decide they could just as well get rich off the planned attack? Bin Laden himself was, after all, from a wealthy and powerful Saudi business family (which, I hasten to add, have disowned him).
After the attacks, in which terrorists commandeered planes owned by the two biggest airlines, United and American, traders in the Chicago options market noticed suspicious pre-Sept. 11 spikes in volume. Put options for stocks in the airlines' parent companies, UAL Corp. and AMR Corp., registered huge trading increases in the week before the attacks.
Investors can use puts, which confer the right to sell a stock at a pre-determined price, to make money when the underlying share price falls, similar to shorting a stock. The terrorist attacks and their effect on the travel industry caused shares of UAL and AMR to fall dramatically when the markets reopened Sept. 17.
Cogswell said most of the options trading was carried out by hedge funds with bearish outlooks. He did not name any of the funds, which pursue risky investment strategies on behalf of wealthy clients.
However, the FBI has now, to very little fanfare and attention, concluded that nothing suspicious was going on Nobody with foreknowledge of the incoming disaster had been trying to make money of the terrorist act. It was, the agency concludes, just a coincidence that high-risk hedge funds happened to trade heavily on airlines on that day.
On Sept. 10, 2001, put options on AMR were 17 times their average volume of 269 contracts. On Sept. 6, 2001, UAL put options were traded at more than four times their average volume of 711 contracts.
Some coincidence! Unlike many, I do believe coincidences can happen, and they do all the time, but I find this one hard to swallow. On the other hand, if I had seen the evidence the FBI has worked through, I may have had to conclude the same. Is such investigations covered by some US public disclosure act?
I would have lost this story if not for The Memory Hole.
11:58:12 PM 
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