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Who Is Michael Milken?
Michael Milken is a philanthropist and current chair of a nonprofit think tank called Milken Institute. Milken was an executive at investment bank Drexel Burnham Lambert during the 1980s and used high-yield junk bonds for corporate financing and mergers and acquisitions. Milken amassed an enormous personal fortune and was indicted in 1989 by a federal grand jury and eventually spent nearly two years in prison after pleading guilty to charges of securities fraud. While he is credited with founding the high-yield debt market, he was banned for life from the securities industry.
Understanding Michael Milken
Milken joined Drexel Burnham Lambert in 1969. It was during his time with the firm that he started trading in high-yield bonds which earned him the nickname Junk Bond King in the 1980s. These bonds provide much-needed capital for companies that don't necessarily have ready access to credit. During his time at the firm, he was able to raise a huge amount of money from a sizable base of interested investors. This allowed him to eventually expand his high-yield bond department. At the height of his success, Milken earned between $200 million and $550 million a year.
On April 24, 1990, Milken plead guilty to five technical counts of violating securities laws. He was sentenced to 10 years in federal prison, but was released after two years for good behavior. He was also fined $600 million. Since his release, Milken has been remaking his image and is attempting to secure a pardon for the charges he plead guilty to in 1990.
Following his release from prison, he worked as a strategic consultant. This was in violation of his probation, and he was subsequently fined $42 million for these actions. In 1993, Milken was diagnosed with prostate cancer. Since then, he has devoted much of his time and resources to the pursuit of a cure for the disease. |