The U.S. Securities and Exchange Commission (SEC) has charged Carl Icahn and his publicly traded company, Icahn Enterprises L.P. (IEP), for failing to disclose the use of IEP securities as collateral for personal margin loans amounting to billions of dollars. These loans were secured through agreements with multiple lenders. To settle the charges, IEP has agreed to pay $1.5 million, while Icahn will pay $500,000 in civil penalties.
The SEC's orders reveal that since at least December 31, 2018, Carl Icahn—who is the controlling shareholder and Chairman of the board of directors of IEP's general partner—pledged between 51% and 82% of IEP's outstanding securities as collateral for personal margin loans under various lender agreements. Despite these agreements and their amendments, IEP did not disclose Icahn's use of IEP securities as collateral in its Form 10-K until February 25, 2022.
Furthermore, Icahn failed to amend Schedule 13D to reflect his margin loan agreements and amendments, some of which date back to at least 2005. This failure included not incorporating the required guaranty agreements and persisted until at least July 9, 2023.
