The FBI has launched what the Wall Street Journal is calling “a major insider-trading probe” that implicates the worlds of finance, gambling and sports. The investigation is aimed at billionaire investor Carl Icahn, golfer Phil Mickelson and Las Vegas gambler William “Billy” Walters and whether Mickelson and Walters illegally traded over a three-year period on private information supplied by Icahn on his company’s potentially market-moving investments.
The FBI and the SEC are looking into whether Icahn tipped off Walters and if Walters passed along the information to Mickelson. Icahn is a friend of Walters, but told the Journal he didn’t know who Mickelson was.
Here’s more from the Journal:
The government investigation began three years ago after Mr. Icahn accumulated a 9.1% stake in Clorox Co. CLX +0.16% in February 2011, said the people briefed on the probe. On July 15, 2011, he made a $10.2 billion offer for Clorox that caused the stock to jump.
Well-timed trading around the time of his bid caught the attention of investigators, who began digging into the suspicious trading in Clorox stock, the people familiar with the probe said.
On Wall Street, rumors had swirled that word leaked out ahead of Mr. Icahn’s Clorox bid. Large, highly risky trades had been made in Clorox options four days before his bid. After his $76.50-a-share offer was announced, those options soared in value along with Clorox shares, which closed on July 15 up 8.9% at $74.55.
Two FBI agents approached Mr. Mickelson on Thursday after he finished a round of golf at the Memorial Tournament in Dublin, Ohio, seeking to speak with him in connection with the investigation, a person familiar with the situation said. Mr. Mickelson referred them to his attorney, this person said.
