According to documents filed by former NSA Director Keith Alexander, the head of the NSA was speculating in commodities linked to China and Russia while receiving asymmetric information on the countries as part of his job. The use of asymmetric or non-public information for financial gain is a crime known as insider trading.
The shares Alexander bought and sold while head of the NSA include those connected to the secretive and politically sensitive potash market. The potash market is largely controlled by Russia and Belarus and one of the largest consumers of potash is China. With Russia and China – two countries the NSA targets for intelligence – as major players it is not hard to see how information coming across Director Alexander’s desk could be useful in getting an information edge on other speculators. Did he use his edge to profit?
Alexander also bought and sold shares in other commodities where asymmetric information on Russia and China could have been beneficial.
On the same day he sold the potash company shares, Alexander also sold shares in the Aluminum Corp. of China Ltd., a state-owned company headquartered in Beijing and currently the world’s second-largest producer of aluminum. U.S. government investigators have indicated that the company, known as Chinalco, has received insider information about its American competitors from computer hackers working for the Chinese military. That hacker group has been under NSA surveillance for years, and the Justice Department in May indicted five of its members…
U.S. officials have long insisted that the information that intelligence agencies steal from foreign corporations and governments is only used to make political and strategic decisions and isn’t shared with U.S. companies. But whether that spying could benefit individual U.S. officials who are privy to the secrets being collected, and what mechanisms are in place to ensure officials don’t personally benefit from insider knowledge, haven’t been widely discussed.
And who knows if these were the only times Alexander was in a position to have non-public information while trading? The NSA comes across quite a bit of information that could be advantageous if someone was looking to make some financial trades. Did Alexander ever use that non-public information to trade in the financial markets?
Also troubling is former NSA Director Alexander’s attempts to seemingly privatize knowledge and relationships gleaned from his government service. Alexander has filed technology patents related to network intrusion and was recently forced to back off having an employee at his new company, IronNet Cybersecurity Inc, that still currently works for the NSA.
Alexander appears to be having some nice private benefits from his public service.
Photo from NSA under public domain.