Icahn Reaches $2M SEC Settlement After Margin Loans Probe

By Crystal Tse

News August 19, 2024 at 10:39 AM

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Billionaire Carl Icahn and his investment firm have agreed to pay $2 million to settle with the U.S. Securities and Exchange Commission after an investigation by the regulator.

Icahn is being fined $500,000 and Icahn Enterprises LP will pay $1.5 million related to insufficient disclosure of how IEP units were pledged as collateral against his personal margin loans, according to an SEC statement Monday.

The investigation started after a report by short-seller Hindenburg Research sent shares in Icahn's investment firm tanking.

The settlement agreement shows that the 88-year-old investor pledged up to 65% of his IEP units from 2018 to 2022.

In exchange, he was granted more than $4.6 billion in personal margin loans by various lenders.

"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 said in a statement.

Both settlement agreements noted that Icahn and IEP cooperated with the investigation in providing relevant information and documents.

They didn't admit nor deny the findings, but agreed to cease and desist from future violations, the SEC said.