British billionaire Joe Lewis, the owner of the Tottenham Hotspur football club in London, has been charged with insider trading in the US.
Federal prosecutors alleged in an indictment in New York that the 86-year-old passed on inside information from companies in which he was a large investor to friends, including his personal pilots, assistants, and romantic partners. Lewis, the founder of investment firm Tavistock Group, faces more than a dozen charges, including securities fraud.
“None of this was necessary, Joe Lewis was a wealthy man,” Damian Williams, the US Attorney for the Southern District of New York, said in a statement Tuesday. “But as we allege he used inside information as a way to compensate his employees or shower gifts on his friends and lovers.”
Prosecutors didn’t announce Lewis’s arrest with the indictment.
“The government has made an egregious error in judgement in charging Mr. Lewis, an 86-year-old man of impeccable integrity and prodigious accomplishment,” Lewis’s lawyer David M. Zornow said in a statement. “Mr. Lewis has come to the US voluntarily to answer these ill-conceived charges, and we will defend him vigorously in court.”
Prosecutors claim Lewis was engaged in insider trading for eight years, passing on material non-public information about several companies, including Solid Biosciences, Australian Agricultural Co. and Mirati Therapeutics. In one instance, Lewis allegedly loaned his pilots US$500,000 each so they could buy shares before a company’s clinical trial news became public.
Lewis, who has a net worth of US$6.6 billion according to the Bloomberg Billionaires Index, is the latest figure to be swept up in an insider-trading crackdown led by federal prosecutors in Manhattan. Last month, prosecutors announced criminal charges against 10 people in four separate cases, including investors in a special acquisition company poised to take Donald Trump’s fledgling media company public.
But Lewis is the highest-profile investor the office has prosecuted for insider trading this year. The Bahamas-based businessman’s firm has stakes in more than 200 businesses, with investments across real estate, hotels and sports, in 13 countries.
Prosecutors also accuse Lewis of defrauding the US Securities and Exchange Commission and Mirati Therapeutics, by hiding his true ownership of shares through shell corporations and false filings.
For several years, authorities say, Lewis used his access to corporate boardrooms to tap valuable information and leak it to his associates before it became public. In 2019, members of Australian Agricultural’s board of directors told Lewis the company had suffered material losses following widespread flooding and that insurance wouldn’t cover its cattle losses.
According to the indictment, Lewis called his two personal pilots, tipped them to the material non public information and told them to sell their stock in the company immediately.
In the same year, he allegedly told his girlfriend in South Korea to purchase shares of Solid Biosciences, a biotech company, after learning about an upcoming private investment and clinical trial. The girlfriend paid US$700,000 — “nearly all of her available funds” — to purchase 150,000 shares, according to the indictment. She sold the shares and made a US$849,000 profit, prosecutors said.
Lewis also tipped two personal assistants working aboard his 322-foot (98-meter) superyacht “Aviva” to invest in special purpose acquisition company, BCTG, as the stock could “double, triple or even quadruple,” according to the indictment.
Before climbing the billionaire’s list, Lewis built a small fortune with a themed restaurant chain and then pivoted to currency trading in the late 70s. He made hundreds of millions betting against the British pound and Mexican peso in the 90s. He used his investment vehicle, Tavistock Group, to diversify into real estate, sports, luxury hotels and biotech.
Lewis is widely known in his home country for his stake in Spurs, a North London Premier League football club.
“This is a legal matter unconnected with the club and as such we have no comment,” Tottenham Hotspur said in an emailed statement.
In the US, Tavistock’s investments include the Boston Waterfront redevelopment, the Wellington Equestrian and Golf Club near Palm Beach, Florida, and the St. Regis hotel in Atlanta, Georgia, according to the company’s website.
Along with singer Justin Timberlake, golfers Tiger Woods and Ernie Els, Lewis also owns the exclusive Albany Bahamas Club, an enclave for the ultra rich that was home to former FTX founder Sam Bankman-Fried before his arrest last year.
An avid art collector, Lewis sold a David Hockney piece for US$90.3 million in 2018 — setting a record at the time for the most expensive piece by a living artist to sell at auction.
His name acquired a remarkable public repercussion at the end of last year, when it became known that Joe Lewis owns an estancia in Lago Escondido, in the province of Río Negro, where judges and officials investigated for alleged bribes by the Federal Justice of Bariloche travelled.
By Ava Benny-Morrison/Bloomberg