Ivan Frederick Boesky is a former American stock trader who became infamous for his prominent role in an insider trading scandal that occurred in the United States during the mid-1980s. He was charged and pled guilty to insider trading, was fined a record $100 million, and became an informant.
In 1966, Boesky and his wife relocated to New York where he worked for several stock brokerage companies. During 1975, he initiated his own stock brokerage company, Ivan F. Boesky & Company, with $700,000 worth of start money from his wife’s family with a business plan that speculated on corporate takeovers. Boesky's company grew from profits as well as buy-in investments from new partnerships. By 1986, Boesky had become an arbitrageur who had amassed a fortune of more than US$200 million by betting on corporate takeovers and the $136 million in proceeds from the sale of The Beverly Hills Hotel. Boesky was on the cover of Time magazine December 1, 1986. During 1987, a group of partners sued Boesky over what they claimed were misleading partnership documents. The U.S. Securities and Exchange Commission investigated him for making investments based on information received from corporate officers. These stock acquisitions were sometimes brazen, with massive purchases occurring only a few days before a corporation announced a takeover. Although insider trading of this kind was illegal, laws prohibiting it were rarely enforced until Boesky was prosecuted. Boesky cooperated with the SEC and informed on others, including the case against financier Michael Milken. As a result of a plea bargain, Boesky received a prisonsentence of years and was fined US$100 million. Although he was released after two years, he was permanently prohibited from working with securities. He served his sentence at Lompoc Federal Prison Camp near Vandenberg Air Force Base in California. Boesky, unable to rehabilitate his reputation after being released from prison, paid hundreds of millions of dollars as fines and compensation for his Guinness share-trading fraud role and a number of separate insider-dealing scams. Later, Boesky began practicing Judaism and attended classes at the Jewish Theological Seminary of America where he had been a major donor; however, during 1987, after the fallout from his financial scandal, The New York Times reported that "after Ivan F. Boesky had been fined $100 million in the insider-trading scandal, the Jewish Theological Seminary, acting at his request, took his name off its $20 million library." In a 2012 interview with The New York Times, a cousin of Boesky's disclosed that he is living in La Jolla, California.
Personal life
During 1991, he divorced his wife and she agreed to pay him $23 million and $180,000 a year for life. They have four children.
In popular culture
The character of Gordon Gekko in the movie Wall Street is based at least in part on Boesky, especially regarding a famous speech he delivered on the positive aspects of greed at the University of California, Berkeley School of Business commencement ceremony during May 1986, where he said in part "I think greed is healthy. You can be greedy and still feel good about yourself".
