(Deletes a reference to Mickelson in paragraph 9 to reflect a
correction by the New York Times to its online May 30 story on
the investigation. The Times now says that while Mickelson is a
focus of the probe, he is not connected to trades involving
By Jennifer Ablan
NEW YORK May 30 The U.S. Federal Bureau of
Investigation and the Securities and Exchange Commission are
investigating possible insider trading involving billionaire
investor Carl Icahn, golfer Phil Mickelson and Las Vegas gambler
William Walters, a source familiar with the matter said.
Federal investigators are looking into whether Mickelson and
Walters may have traded illegally on private information
provided by Icahn about his investments in public corporations,
the source told Reuters, confirming reports on Friday.
Icahn, a legendary activist investor, told Reuters that he
was unaware of any investigation and said that his firm always
followed the law. He acknowledged a business relationship with
Walters but said that he did not know Mickelson personally.
"I am very proud of my 50-year unblemished record and have
never given out insider information," he said.
Walters and Mickelson play golf together, the source
familiar with the investigation told Reuters.
Walters did not respond to requests for comment.
Spokespeople for Mickelson, the FBI and the SEC declined to
comment. The Wall Street Journal cited Glenn Cohen, Mickelson's
lawyer, as saying the golfing legend was not a target of the
None of the three men have been accused of any wrongdoing,
the source told Reuters.
YEARS OF INVESTIGATING
The investigation began three years ago according to the
source. It is the latest to emerge from a multi-year crackdown
on insider trading by U.S. authorities.
The investigation centers on suspicious trades in Clorox Co
by Walters as Icahn was trying for access to the board
of the consumer products company in 2011, the New York Times
reported, citing people briefed on the probe.
Icahn had accumulated a 9.1 percent stake in Clorox in
February 2011. In July, he made an offer for the company that
valued it at above $10 billion and sent its stock soaring.
Investigators were also looking into trades that Mickelson
and Walters made related to Dean Foods Co, the Journal
cited the people as saying. The New York Times cited people
briefed on the investigation as saying that in that particular
case, investigators are looking into trades placed around 2012
just before the company announced quarterly results.
Those trades appeared to have no connection to Icahn, the
newspaper added. Icahn told Reuters he had never purchased
shares nor been involved with Dean.
Federal prosecutors in Manhattan are handling the inquiry in
conjunction with the FBI and the SEC, the New York Times
reported. Since August 2009, Manhattan U.S. Attorney Preet
Bharara's office has convicted 81 people of insider trading,
either at trial or via guilty pleas, with no acquittals.
The current investigation made little headway initially, the
Times reported. Investigators are searching phone records,
seeking to determine whether Icahn had spoken to Walters before
the trades, the Times cited anonymous people briefed on the
probe as saying.
And about a year ago, FBI officials approached Mickelson at
Teterboro Airport in New Jersey, asking the celebrity golfer to
discuss his trading, the Times cited its sources as saying.
Icahn, a prolific tweeter and vocal critic of some of
America's largest corporations, habitually broadcasts his
thoughts on corporations and, occasionally, stock positions he
has taken. The billionaire took to Twitter earlier this year
when he pushed Apple Inc's board to expand the iPhone maker's
buyback program, and several times tweeted when he had increased
his position in the tech company.
During a campaign to get eBay Inc to hive off its
fast-growing PayPal division, he openly criticized the Internet
retail giant's board. But the activist investor has tweeted just
once in the past three weeks.
Even if Icahn did leak information about his plans regarding
Clorox, it may not necessarily have violated the law. Insider
trading regulations prohibit trading based on material,
nonpublic information obtained from someone who breached a
fiduciary or confidentiality duty by disclosing it.
As a non-board member, Icahn owed no duty to Clorox
shareholders. It is possible, though by no means definite, that
Icahn owed a confidentiality duty to his own shareholders.
(Reporting by Jennifer Ablan; Writing by Edwin Chan; Editing by