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Trading in two little-known New York-listed stocks soared in the weeks before the companies announced the appointment of Trump family members to their advisory boards.
Shares in Unusual Machines, a drone maker that listed on Nasdaq last year, almost tripled in the four weeks leading up to its November 27 disclosure about the recruitment of Donald Trump Jr, according to a Financial Times analysis.
Shares in Dominari Holdings, a securities and fintech group headquartered in New York’s Trump Tower, rose by 580 per cent in the six weeks before its February 11 filing revealing that Trump Jr and another of President Donald Trump’s sons, Eric Trump, had joined its advisory board.
Regulatory experts said the timing and scale of the moves, which do not seem linked to earnings reports or other announcements in the period, were “clearly unusual”. Both stocks made further large gains after the appointments were announced.
“The dramatic movement before the equally dramatic announcement suggests that this was not a hermetically sealed event,” said Bill Singer, a lawyer and former regulatory attorney at the American Stock Exchange.
Average daily trading volume in Unusual Machines, whose market value is about $90mn, rose to 290,000 shares in the four weeks leading up to its disclosure, up from just 93,000 between March and October 2024. Dominari, which has a market value of about $60mn, saw an even steeper increase, from 11,700 between March and December 2024 to 1.2mn.
Disclosures revealed that the two Trump brothers were each given 966,000 shares in Dominari, worth 6.7 per cent of the company, prior to the announcement of their roles.
An Unusual Machines filing in November revealed that Trump Jr held 200,000 shares issued under “a restricted stock unit agreement and advisory agreement”, in addition to 131,000 shares he bought.
In the same filing, Unusual Machines said it “has been heavily dependent on Chinese imports” and highlighted “political unrest affecting [its] relationship with China and future tariffs” as a risk to its future operations.
Unusual Machines said knowledge of Trump Jr’s planned involvement was limited to three senior officers, as well as its board and counsel. It said it had “no reason to believe that any of these people breached any duty, whether legal or fiduciary”, and the company has “no knowledge as to why any investor bought [its] stock during this period”.
Unusual Machines’ initial public offering last year was underwritten by Dominari.
Dominari did not respond to a request for comment.
A spokesman for Trump Jr did not respond to requests for comment. Eric Trump did not respond to a request for comment via the Trump Organization.
Adam Pritchard, a University of Michigan law professor, described the stock movements as “clearly unusual”. But he added: “It doesn’t follow that it’s insider trading. As a board adviser, Donald Trump Jr does not necessarily have an obligation not to trade off information — like a board director usually does.”
Unusual Machines said: “We have no reason to believe that Don Jr breached his NDA [non-disclosure agreement].” Dominari did not respond to a request for comment on whether it imposed any such conditions on Trump Jr or Eric Trump.
While both companies’ shares are now trading below levels immediately prior to Trump Jr’s appointment being made public, they remain above levels a year ago.
News of the trading activity comes amid scrutiny of potential conflicts of interest involving the president’s family members, who have long maintained business ties while engaging in political life.
In October 2021, the announcement of a planned merger between Trump Media & Technology Group, which is majority owned by Trump Jr and operates social media site Truth Social, and blank-cheque company Digital World Acquisition Corp drew regulatory attention when trading volume surged the night before the deal was announced.
Additional reporting by Chris Cook
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