Having denied any investigation as "inflammatory and speculative" when the Phil Mickelson insider-trading brouhaha initialy erupted two years ago, it appears the golfer's lawyers may have to shift from the "deny deny deny" defense to "let's make a deal." Having been unable to pin anything on Wall Street insider Carl Icahn, Vegas sports gambler Billy Walters, and pro-golfer Mickelson with regard their trading in Clorox (during Icahn's takeover bid); the SEC has arrested Walters and announced criminal charges against Dean Foods' Chairman Thomas Davis (who stepped down after suspicions of leaking insider tips) and after generating nearly $1million in profits from the Dean Foods trading tip Phil Mickelson is charged with insider trading and wilb be forced to disgorge ill-gotten gains.
Two yesars ago, the denials were quick to come…
"We do not know of any investigation," Mr. Icahn said on Friday. "We are always very careful to observe all legal requirements in all of our activities." The suggestion that he was involved in improper trading, he said, was "inflammatory and speculative."
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"Phil is not the target of any investigation. Period," said a lawyer for Mr. Mickelson,
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When asked to comment about the investigation, Mr. Walters, reached by phone on Friday, said, "I don't have any comment about anything," and then hung up.
Today, Mickelson's lawyers are aggressively providing no comment as it appears he was unable to dodge another bullet for his day-trading prowess.
As NYTimes Dealbook reports, Federal authorities announced criminal charges on Thursday against the former chairman of Dean Foods and a high-rolling sports gambler with ties to prominent athletes and corporate executives, a surprising escalation of a long-running insider-trading investigation.
William T. Walters, often considered the most successful sports bettor in the country, was arrested by the F.B.I. in Las Vegas on Wednesday. Thomas C. Davis, the former chairman of Dean Foods who stepped down last year after being suspected of leaking insider tips to Mr. Walters, also faces charges.
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Preet Bharara, the United States attorney in Manhattan, who led a sweeping crackdown on insider trading, lamented “a potential bonanza for friends and family of rich people.”
But in charging Mr. Walters and Mr. Davis with securities fraud, his office is sending a message to Wall Street and beyond that these cases can still be made. The charges could also become a test case in just how far prosecutors can go in the wake of the appellate court ruling.
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Mr. Walters’s lawyer said his client had done nothing wrong. “Bill Walters is a true American success story, whose extraordinary accomplishments as a lawful sports gambler have been widely recognized and lauded,” the lawyer, Barry Berke, said in a statement. “Mr. Walters and his counsel look forward to his day in court where it will be shown that the prosecutors’ accusations are based on erroneous assumptions, speculative theories and false finger-pointing.”
Early in the investigation, federal authorities also looked at what role, if any, the billionaire investor Carl C. Icahn may have had in sharing information with Mr. Walters about the consumer products company Clorox. Mr. Icahn was mounting a takeover bid for Clorox.
But that aspect of the investigation did not bear fruit, and Mr. Icahn is not suspected of wrongdoing.
Mr. Walters’s case bridges the world of sports and finance. In the course of the investigation, federal authorities examined trades not just by Mr. Walters, but by some of his friends, including the golfer Phil Mickelson.
Mr. Mickelson, a three-time winner of the Masters golf tournament and one of the country’s highest-earning athletes, has not been accused of wrongdoing. Nor is there any indication that he will be charged.
But on at least two occasions, the F.B.I. contacted Mr. Mickelson, partly to seek his cooperation against Mr. Walters, people briefed on the investigation have previously said. Once, agents approached him on a golf course.
However, while NYTimes claims no charges, MarketWatch reports golfer Phil Mickelson on Thursday was charged with insider trading, in connection with a case where two others are facing criminal charges.
Mickelson was charged with insider trading by the Securities and Exchange Commission due to an alleged tip he received from gambler William “Billy” Walters, who got information from former Dean Foods chairman Thomas Davis.
The SEC said that Walters called, and then sent text messages, to Mickelson, who then bought a $2.4 million position in three accounts he controlled. Those securities “dwarfed” Mickelson’s other holdings, which were collectively valued at less than $250,000, the SEC said. Mickelson had not been a frequent trader and these were his first ever Dean Foods purchases, the SEC said. Mickelson made a profit of approximately $931,000 from the stock he held for about a week.
The Justice Department alleges Davis provided material non-public information to Walters, who is also charged in a separate indictment, about Dean Foods earnings results, outlook and the spinoff of Whitewave-Alpro, a Dean subsidiary.
As The SEC writes (full charge document below), The Walters Group, Nature Development, and Mickelson received the gains described above as part of, and as a consequence of, the securities law violations by Defendants Walters and Davis described above, under circumstances in which it is not just, equitable, or conscionable for them to retain the funds.
By reason of the foregoing, The Walters Group, Nature Development, and Mickelson have been unjustly enriched and must disgorge the amount of their ill-gotten gains.
via http://ift.tt/1Troi2v Tyler Durden