Two days before the insider trading case against Raj Rajaratnam began, Ivan Boesky celebrated his 74th birthday. Boesky, a native of Detroit and the son of Russian immigrants, is a former Wall Street arbitrageur who infamously confessed to insider trading charges in 1986. He's one of the central subjects of James B. Stewart's award-winning book Den of Thieves, and is thought to have been the inspiration for Michael Douglas' Academy Award-winning role of Gordon Gekko in Oliver Stone's 1987 film "Wall Street" (Gekko's "greed is good" speech is said to have been taken straight from a speech Boesky gave at Berkeley in 1986 in which Ivan called greed "healthy" and said "you can be greedy and still feel good about yourself").
By the mid 1980s, Boesky, a graduate of Michigan State University's law school, had amassed hundreds of millions of dollars by investing in public firms he deemed to be prime takeover targets. Boesky would invest millions in these firms' stocks, and, if the firms were acquired, their share prices would typically skyrocket. Boesky would then cash out and turn a quick (and quite large) profit.
It turned out that Boesky was less a great predictor of a firm's imminent takeover than a great gainer of material inside information -- that is, he'd receive tips from insiders about firms soon to be purchased and trade on that information (this is similar to what the SEC has accused Raj Rajaratnam of having done).
Boesky, in addition to being a crook, was also a bit of an eccentric -- and not the most congenial of managers. He always wore three-piece black suits, a white starched shirt, and a gold chain hanging out of his vest pocket. He took a limousine to the office and, if he wouldn't be making it in on a certain day (he arrived at 7 a.m.), he'd call in at 7:01; if no one answered the phones, he'd fly into a rage.
Although he never worked the day after Thanksgiving, he expected all of his employees to be in the office, and just to make sure they were there, he'd call in at least 10 times. Other days he wasn't in the office, he'd call in up to 30 times.
Once, Boesky called in during a fire drill, and when no one answered the phones, he grew furious. The following day, after finding out about the drill, he released this memo to his employees: "Certainly I don't want you to risk your lives. But I extend my appreciation to those of you who stayed behind."
At one point during his career, Boesky bought a puppy and kept it in his office; he even brought it along to meetings. However, after the dog, who was not yet housebroken, left a surprise pile (not of papers) on the floor of Ivan's office, no one who worked for Boesky ever saw the dog again.
Boesky was also known to be a picky eater. He'd often eat just a single flake of a croissant for breakfast, one grape for lunch, and when he was hungry and actual ate (typically out at one of Manhattan's fancy establishments), he'd do something like order one of each entree, take a bite of each one, choose the one he liked best, then send the rest back.
After Boesky was busted and barred from the securities industry (he ended up serving three and a half years in jail), he quickly became the poster boy for Wall Street greed and hubris. His face was on the cover of Time, and his name became synonymous with white-collar crime. Since, his name has been called out in television shows such as "The Shield" and "Futurama," and in films such as "Ocean's Eleven" and "American Psycho."
Today, 25 years after he plead guilty to insider trading, Boesky is thought to be broke, surviving on alimony checks he receives from his ex-wife.
(Den of Thieves)
(Related: Career Guide to Insider Trading, Chapter 16: Plea Agreements)