Madoff explains that dark pools obscure information (that's good...that's what smart buyers and sellers do,) fast execution prevents leakage of information (that's good too!) but leakage inevitably happens. This leakage, he tags as insider trading.
[Side note: This insider trading argument about leakage is complicated stuff! Maybe this set of rules helps you understand. If your information is bad and it leaks, you are dumb money being outsmarted. If your information is irrelevant but your trades leak, you're being front run. If your information is good and your trade leaks, you are insider trading. Got that?]
Is information leakage really insider information? Of course not! Why is anyone interested in the financial market prognostications of a convicted felon who completely failed to successfully manage anyone's money??