How Can You Tell When an Investor is Too Big to Fail or Go to Jail

What does a mega-successful investor do when caught with his hand in the cookie jar? Pay the relatively small fine and sell $400 million in depository units, of course. This is what the billionaire head of Icahn Enterprises did. According to a regulatory filing on Monday, Carl Icahn has announced plans to sell up to $400 million in depository units through an "at-the-market" offering to buffer a certain price drop in his firm's shares. In fact, this news led to a nearly 3% drop in the company's share price.

The proceeds from this offering are expected to be used for potential acquisitions and general corporate purposes.

This development follows a recent settlement with U.S. regulators, in which Icahn and his company agreed to pay $2 million in fines. The settlement resolved charges that Icahn had failed to disclose, such as that he had pledged most of the firm's securities as collateral for personal margin loans over several years.

Icahn Enterprises continues to face ongoing tensions with Hindenburg Research. This short-seller accused the company of operating a "Ponzi-like" scheme by allegedly inflating the value of its assets to sustain dividend payments. Hindenburg also raised concerns about Icahn's use of margin loans.

According to a separate statement, Jefferies has been appointed the sales agent to manage Icahn Enterprises' share sale program.

Final Notes

Carl Icahn is one of my investing idols. So, this article is in no way a criticism of the man. He is just leveraging the advantages the systems give him and many mega-wealthy investors . Also, I am not crusading for change since that will never happen. However, inflating the value of a firm's assets is the crime the NY justice system found Trump guilty of, and it intends to send him to prison if the appeals don't work. I think it's essential to know that we investors are not playing on a level field.

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