Experts in government accountability, including President George W. Bush’s former White House ethics counsel, warn that billionaire investor Carl Icahn’s status as an unpaid White House adviser represents a serious conflict of interest and a possible violation of federal law.

In particular, they say Icahn’s company raised red flags with a successful bet on falling prices for biofuel credits that may be linked to his influence at the White House.

The story begins in December, when Donald Trump’s transition team announced that his friend Icahn would serve as “a special advisor to the President on regulatory reform.” In that role, Icahn has urged Trump to make changes to the federal renewable fuel (better known as ethanol) standards that would benefit one of Icahn’s companies, CVR, which owns two oil refineries. The Trump administration leaked in February that it is actively considering the rule changes Icahn advocates, such as shifting the obligation to buy biofuel credits from the refiner to the companies that actually blend ethanol into gasoline. Freeing refineries of that burden would be a boon to their bottom lines. Thanks to Icahn’s influence in the White House and the possibility of such helpful policy changes, CVR’s stock price has surged, benefitting Icahn, the majority stakeholder.

But a Reuters report last week added an even more confusing — and, good-government advocates say, improper — wrinkle. Thanks to the threat of Icahn’s desired regulatory changes, the value of tradable renewable fuel credits has taken a nosedive. And guess which company recently bet $50 million on shorting renewable fuel credits: Icahn’s CVR.

Trump administration opponents have taken notice: On Tuesday, eight Democratic senators, including Elizabeth Warren of Massachusetts, sent a letter to the heads of the Securities and Exchange Commission, the Commodity Futures Trading Commission and the Environmental Protection Agency asking them to investigate Icahn’s potential market manipulation or insider trading.

“We are writing to request that your agencies investigate whether Carl Icahn violated insider trading laws, anti-market manipulation laws, or any other relevant laws based on his recent actions in the market for renewable fuel credits,” the senators wrote. (The agencies have not yet responded to the senators and they have no legal obligation to do so.)

While the senators were careful to couch their concerns as being about merely potential misbehavior, government watchdogs that spoke to Yahoo News are unequivocally alarmed by the actions of Icahn and the Trump administration. “As a special adviser, it is an enormous conflict of interest for Icahn to be moving the administration in a way that directly benefits him financially,” says Tyson Slocum, director of the energy program at Public Citizen, a consumer rights advocacy group. “Financially self-interested parties cannot be put in charge of dictating regulatory policy.”

Government ethics experts say that, as an unpaid but regular adviser, Icahn is what is called a Special Government Employee, who should either have to divest his holdings that could be affected by his work in the White House or resign his role.

“I think he’s got serious problems with ethics law and insider trading,” says Richard Painter, a Trump critic who was the chief White House ethics lawyer in the George W. Bush administration from 2005–2007 and now teaches law at the University of Minnesota. “We went through this with Ivanka Trump: [The administration] said she was going to be a volunteer and not a federal employee. I said, ‘This is ridiculous. She has a West Wing office, security clearance, she’s an employee.’ With Icahn, it’s a little different because he has no office or security clearance. But if you give someone a title you give them what we call ‘apparent authority.’”

Carl Icahn gives an interview on the Fox Business Network. (Photo: Brendan McDermid/Reuters) More