An American stock speculator who used inside information to strategically buy and sell stocks and profit from the mergers and takeovers of businesses. He is remembered for declaring that “greed is healthy” in 1985 at a college commencement address. Just over a year later, in November 1986, Boesky pleaded guilty to insider trading charges and agreed to pay a $100 million fine and to cooperate with the Securities and Exchange Commission’s ongoing inside trading investigation. He also received a three-year sentence. The fine was by far the largest settlement obtained by the SEC for insider-trading activity at that point. His cooperation with federal authorities also led to the convictions of others, including junk-bond king Michael Milken and Boesky’s employer, Drexel Burnham Lambert.
Boesky testified that he had gained his $200 million fortune using illegal inside information about impending mergers to trade stock in the companies involved. As a result of Boesky’s confession, subpoenas were issued to some of the world’s most famous financiers, including “Junk Bond King” Michael Milken. Boesky’s testimony directed investigators to Milken and Drexel for their participation in the illegal schemes. As a result of this insider trading scandal, the U.S. Congress increased the penalties for securities violations.