These infamous financiers are no stranger to greed. They managed to live the life of luxury for years while friends, clients and even some family members had no idea about their double-life. Here are five examples of greedy investors and where they are today. (Read up on other Wall Street villains in The Biggest Stock Scams Of All Time and 4 History-Making Wall Street Crooks.)
- Michael Milken
Back in 1989, Milken was indicted 98 charges of securities fraud. It was just the beginning of an onslaught of media coverage into the life of "The Junk Bond King." After being charged, he served two years of a 10-year sentence at a Federal minimum security prison. He was found guilty of multiple charges including six felony counts of securities fraud and conspiracy, and was barred for life by the SEC from working in the securities field.
After a couple of years in prison, Milken tried reinventing himself into a leader in business education and crusader against cancer after suffering from prostate cancer. He helped initiate Bizmore, a website dedicated to educating executives at small- and medium-sized companies on topics relevant to today's growing companies. He also has his own website where he describes himself as a medical research innovator, philanthropist and financier.
- Ivan Boesky
At the time considered one of America's richest stock market speculators, "Ivan the Terrible" was arrested in 1986 for insider trading. Boesky paid $100 million in penalties and served three years in prison for betting on corporate takeovers using inside information. While mergers and acquisitions could be done using public information, Ivan traded stocks in companies targeted for takeover by illegally manipulating the stock. After he was charged, he was also barred by the Securities and Exchange Commission from the world of trading. (Learn more about Boesky and his ilk in Top 4 Most Scandalous Insider Trading Debacles.)
Ironically, one of his most memorable quotes was from a commencement speech he gave at the University of California, Berkeley, School of Business Administration where he stated "Greed is all right, by the way. I want you to know that. I think greed is healthy. You can be greedy and still feel good about yourself."
During the scandal, he separated from his wife and in 1991 they filed for divorce. After he left prison, Boesky enrolled in rabbinical studies and became involved in projects helping the homeless. Since then, Ivan Boesky has stayed out of the spotlight.
- T. Boone Pickens
In the 1980s, Pickens was known as a takeover specialist and corporate raider. His business tactics were said to put many independent oil producers out of business. Pickens founded the company that became Mesa Petroleum and soon realized the potential in acquiring oil companies. Due to his string of company takeovers, he was accused of taking companies apart after purchasing them and in the process, leaving workers out of jobs.
Pickens reinvented himself as an environmentalist who believes in pushing green power while also focusing on philanthropic duties such as the T. Boone Pickens Foundation. Recently, the Dallas billionaire was named to the board of directors of the National Football Foundation and College Hall of Fame. He considered is one of the richest men in the world with an estimated net worth of $3 billion.
- John Rigas
Rigas was the founder of Adelphia Communications Corp., the fifth largest cable company in the United States. In early 2000, it reported revenue earnings of $3 billion. In 2004 Rigas was convicted along with his son Timothy of conspiracy, bank fraud and securities fraud for stealing funds from their company and its investors. The money was used to cover hidden debt and buy personal high priced items. He was sentenced to 15 years in prison.
Most recently, a federal appeals court has planned to decide whether Rigas and his son will face a second trial. Rigas has a website called johnrigas.com where he talks about what "really happened" with Adelphia. He also has a Twitter account where you could follow his goings-on. (Learn more in 5 Lessons From The World's Biggest Bankruptcies.)
- Bernard Ebbers
Ebbers was convicted on March 15, 2005 after being charged with nine counts of conspiracy, securities fraud and making false regulatory filings. At the high point of his career, Ebbers was the CEO of WorldCom, the nation's second largest long distance telecommunications company through a series of acquisitions. His demise came after he was charged with producing fraudulent accounting statements.
After Ebbers fell into debt in 2000 and shares of WorldCom plummeted, the U.S. Justice Department stepped in to investigate. Auditors found several accounting irregularities. Ebbers was found guilty of fraud and sentenced to 25 years in prison, which he started serving in 2006. He requested a pardon from former President George W. Bush but it was neither denied nor granted - Bush left office and the case is still pending. (To spot the signs of earnings manipulation, you need to know the different ways companies can inflate their figures. Read Cooking The Books 101.)
The Bottom Line
While a certain amount of greed may push you to succeed, it is a compounding emotion that often spirals out of control. Eventually, though, you are likely to be brought to justice, so you're better off staying clean unless you're willing to risk the jail time.