WASHINGTON (Reuters) - Eight Democratic senators asked U.S. regulators on Tuesday to launch an investigation into billionaire Carl Icahn’s activities in the U.S. biofuels blending credit market, saying the activist investor may have violated trading laws since becoming an adviser to President Donald Trump.

FILE PHOTO: Billionaire activist-investor Carl Icahn gives an interview on FOX Business Network's Neil Cavuto show in New York, U.S. in this file photo dated February 11, 2014. REUTERS/Brendan McDermid/File Photo

“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 said in a letter to the heads of the Securities and Exchange Commission, the Commodity Futures Trading Commission and the Environmental Protection Agency.

The letter, a copy of which was seen by Reuters, was signed by Elizabeth Warren of Massachusetts, Sheldon Whitehouse of Rhode Island, Sherrod Brown of Ohio and five others. The agencies are not required to act on it.

Efforts to reach Icahn for comment were not immediately successful.

There have been months of public outcry from Democratic lawmakers and liberal watchdog groups concerned that Icahn’s dual role as a high-powered investor and presidential adviser could lead to conflicts of interest.

Trump, a Republican, named Icahn as an unpaid adviser on regulation shortly after November’s election, saying the choice could help him slash red tape and bolster economic growth.

In February, Icahn submitted a proposal to the White House to change the U.S. biofuels program in a way that would ease its regulatory burden on oil refining companies, already struggling with low profit margins. Icahn owns a majority stake in refining company CVR Energy Inc CVI.N.

The White House is considering the proposal. An administration official did not immediately respond to a request for comment on Tuesday.

A Reuters review of securities filings last month showed that CVR had accumulated a large short position in biofuels blending credits, called Renewable Identification Numbers, or RINs, which many refiners are required to purchase under the biofuels law. That meant the company would have been in a strong position to profit if RIN prices fell.

In their letter, the senators pointed out that RIN prices dropped sharply in late February after Icahn’s proposal on the biofuels regulation was reported.

“We have no way of knowing at this time whether Mr. Icahn made any of his renewable fuel credit trades or decisions about trades based on material, non-public information or otherwise manipulated the market,” the senators wrote.

“But the publicly available evidence is troubling, and based on this evidence, we ask that your agencies investigate whether Mr. Icahn’s conduct violated any laws under your jurisdiction,” they said.

Icahn previously dismissed accusations that his proposal to the White House to change the biofuels program was self-serving, saying the overhaul would help other refining companies too, including his competitors.

CVR Energy shares fell 0.4 percent to $22.20 on Tuesday. A CVR spokesman declined to comment.

Shares in Icahn's investment firm, Icahn Enterprises IEP.O, fell 4.3 percent to $50.82.

‘NOT SHY’

Icahn, 81, has spent decades doing battle with major companies as an activist investor, and has amassed a fortune that Forbes Magazine pegs above $20 billion. In recent years, he built up an 82 percent stake in CVR, making him a player in the niche biofuels market.

“Carl Icahn is not shy, and he knows his voice and his actions as special adviser can influence the RIN markets,” said Tyson Slocum of Public Citizen, a liberal watchdog group that has already asked Congress to investigate whether Icahn had violated any lobbying disclosure laws.

“The real issue is did Carl Icahn use his position as special adviser to unduly impact the RIN market and then make corresponding bets on those moves,” Slocum said.

CVR Energy's refining unit CVRR.N posted a net gain of $6.4 million associated with the biofuel credits market in the first quarter of 2017, a $50 million turnaround from the year-ago period when CVR shelled out $43.1 million, the company said in a filing.

The U.S. Renewable Fuel Standard, overseen by the U.S. Environmental Protection Agency, requires increasing volumes of biofuels to be blended into the nation’s gasoline and diesel every year. It places that responsibility mainly on refiners, who are required to blend the fuel themselves or purchase credits from others that do it for them.

Icahn’s proposal had called for regulators to shift the responsibility for blending from refiners, many of which lack sufficient blending capacity, to terminal operators.

A number of biofuels groups oppose the proposed change, saying it could undermine the Renewable Fuel Standard by making it more complicated, since there are many times more terminal operators than refining companies.

“Moving the point of obligation would require a dramatic increase in the staff required to track this at EPA, all while delivering poorer supervision, increasing the complexity of the program, and ultimately higher costs for American drivers,” said Growth Energy Chief Executive Emily Skor.