The Securities and Exchange Commission has charged Carl Icahn with hiding billions of dollars worth of stock pledges, resulting in a $2 million settlement with the legendary corporate raider.
Icahn, 88, will pay a fine of $500,000, while his firm will up $1.5 million as part of two separate settlement agreements after he failed to properly disclose billions in margin loans without disclosing them to shareholders or federal regulators.
The agreements, disclosed on Monday, show that the 88-year-old investor pledged up to 65% of stock in his publicly-traded Icahn Enterprises LP (IEP) from 2018 to 2022.
In exchange, he was granted more than $4.6 billion in personal margin loans by various lenders. A margin loan is when an investor can borrow against the value of securities they already own as a means of obtaining short-term funding.
The probe was opened after a report by short-seller Hindenburg Research that sent shares in Icahn’s investment firm tanking last year.
“We are glad to put this matter behind us and will continue to focus on operating the business for the benefit of unit holders,” Icahn was quoted as saying by Bloomberg.
Both settlement agreements said Icahn and his IEP investment vehicle cooperated with the investigation and have agreed to cease and desist from any repeat violations.
But in the carefully-worded statement, neither Icahn nor his firm admit or deny the findings.
