US charges British billionaire Joe Lewis with insider trading (updated)

Solid Biosciences

26/07/2023 24:02

(Adds accusations, details from indictment, earlier Bear
Stearns investment, bylines)
    By Jonathan Stempel and Luc Cohen
       NEW YORK, July 25 (Reuters) - Joe Lewis, the British
billionaire and owner of the Tottenham Hotspur soccer team, has
been criminally charged in New York for orchestrating a "brazen"
insider trading scheme.
    Prosecutors said Lewis exploited his access to corporate
boardrooms by passing tips about companies in which he invested
to friends, personal assistants, private pilots and romantic
partners, enabling them to reap millions of dollars of profit.
    "None of this was necessary. Joe Lewis is a wealthy man,"
U.S. Attorney Damian Williams said in a video on the X social
media platform, formerly known as Twitter.
    "But as we allege he used inside information as a way to
compensate his employees or shower gifts on his friends and
lovers," Williams continued. "That's classic corporate
corruption. It's cheating. And it's against the law."
    Lewis, 86, who founded the investment firm Tavistock Group,
was charged with 16 counts of securities fraud and three counts
of conspiracy, for alleged crimes spanning from 2013 to 2021. 
    Tavistock and a spokeswoman did not immediately respond to
requests for comment outside business hours.
    Lewis is worth $6.1 billion, according to Forbes magazine.
    Insider trading has long been a focus of Williams' office,
dating to 2009 when a crackdown began under one of his
predecessors, Preet Bharara.
    Lewis was accused of having from 2019 to 2021 passed
material nonpublic information about companies such as Mirati
Therapeutics  MRTX.O , Solid Biosciences  SLDB.O  and Australian
Agricultural Co  AAC.AX .
    He was also accused of having from 2013 to 2018 conspired to
defraud Mirati, the U.S. Securities and Exchange Commission and
investors by using shell companies and other means to hide his
more than 20% stake in the cancer therapy company.
    Prosecutors said that in some insider trading cases, Lewis
lent money to recipients of his tips, including in Oct. 2019
when he wired $1 million to two pilots so they could buy more
Mirati shares.
    The indictment quoted one pilot texting a friend that "Boss
lent Marty and I $500,000 each for this," and that he thought
"the Boss has inside info" because "otherwise why would he make
us invest."
    Both pilots allegedly repaid their loans soon after Mirati
announced favorable results from a clinical trial, causing its
stock price to rise 16.7%.
    "Loan payback for MRTX," the second pilot wrote in his
records.
    Lewis is also known for taking a nearly 10% stake in Bear
Stearns in 2007, shortly before the Wall Street bank narrowly
avoided collapse and was bought by JPMorgan Chase  JPM.N  at a
fire-sale price. His losses were estimated at more than $1
billion.

 (Reporting by Jonathan Stempel and Luc Cohen in New York;
Editing by Chris Reese and Lincoln Feast.)
 ((eric.beech@thomsonreuters.com; 202-898-8322; Reuters
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