Reports of an insider trading investigation involving Carl Icahn have cost the activist investor a big chunk of change.
According to Forbes, media reports of the probe sent shares of Icahn Enterprises (IEP) down 4% on Monday, a loss of $420 million. Icahn Enterprises — 88% owned by Carl Icahn himself — fell after the Wall Street Journal reported on Friday that federal regulators were looking into trades of Clorox (CLX) stock made by sports gambler Billy Walters and pro golfer Phil Mickelson that might have been spurred by a tip from Carl Icahn. For his part, Carl Icahn dismissed the report, which he called “inflammatory and speculative” and “irresponsible on the part of the Wall Street Journal.”
Investigators from the SEC and FBI reportedly began investigating the matter three years ago. The probe reportedly focuses on whether Carl Icahn told Walters of his plans to take a stake in Clorox. Walters may then have told Mickelson of Carl Icahn’s plans.
When Carl Icahn announced his stake in Clorox, the company’s shares jumped more than 7% in one day.
No charges have been announced by federal regulators and Carl Icahn might not have violated securities laws even if he did inform Walters of his plans to take a stake in Clorox.
Mickelson says he is cooperating with investigators and says he did nothing wrong.
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