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Joe Lewis, the billionaire real estate investor whose family owns Tottenham Hotspur football club, has surrendered to US authorities in New York, federal prosecutors confirmed on Wednesday.
Lewis was charged on Tuesday with 19 counts, including securities fraud and conspiracy to commit securities fraud and make false statements, over multiple instances of alleged insider trading.
The 86-year-old, who is one of Britain’s richest men, is accused of tipping off employees, two of his private pilots, associates, friends and romantic interests with non-public information about companies in which he had invested, and lending some of them hundreds of thousands of dollars to trade on the knowledge.
According to the indictment unsealed in Manhattan federal court on Tuesday, Lewis and his associates were collectively able to make millions of dollars using the “stolen” information, which included favourable results from clinical trials.
Lewis will be arraigned later on Wednesday — a process during which he faces a judge who will confirm the charges and decide whether to grant bail. If convicted of the criminal charges, Lewis could be jailed for decades.
US prosecutors on Wednesday also charged the two pilots, Patrick O’Connor and Bryan Waugh, with securities fraud. The Securities and Exchange Commission also filed a parallel civil complaint against Lewis, the pilots, and Lewis’s former girlfriend Carolyn Carter, seeking penalties and the disgorgement of hundreds of thousands of dollars worth of alleged “ill-gotten gains”.
Lewis, whose investments are largely held through a portfolio company, Tavistock Group, is alleged to have shared information about publicly traded life science groups Solid Biosciences and Mirati Therapeutics, as well as beef producer Australian Agricultural Company (AAC) and a special purpose acquisition company BCTG.
Lewis’s lawyer, David Zornow of Skadden Arps, said: “The government has made an egregious error in judgment in charging Mr Lewis, an 86-year-old man of impeccable integrity and prodigious accomplishment. Mr Lewis has come to the US voluntarily to answer these ill-conceived charges, and we will defend him vigorously in court.”
A representative for Tavistock Group did not immediately respond to a request for comment.
Among those with whom Lewis is alleged to have shared information are a girlfriend, personal assistants aboard the $250mn superyacht on which he sometimes lives, and two of his private pilots.
For a period of at least eight years, Lewis used information he was given as a board member of certain companies to help those in his orbit know when to buy stock or sell it before its value dropped, prosecutors said.
In 2019, he allegedly told the pilots about the financial losses that AAC would incur as a result of flooding in Queensland and urged them to sell their investments in the company before the information was disclosed. The pilots were unable to execute the trades in time, according to the indictment, but one of them allegedly emailed their stockbroker, “just wish the Boss would have given us a little earlier heads up”.
In the same year, prosecutors said Lewis told his girlfriend about an upcoming transaction and the results of a clinical trial involving Solid Biosciences, shortly after which she purchased $700,000 worth of the company’s shares. Later in 2019, Lewis told his girlfriend to sell Solid’s stock and buy Mirati shares instead, after receiving updates about one of the latter’s clinical trials, prosecutors alleged.
Damian Williams, the US attorney for the Southern District of New York, said Lewis had “abused his access to corporate boardrooms” and, that the tips he passed on ensured that his associates’ “bets were a sure thing”.
“He used inside information as a way to compensate his employees or to shower gifts on his friends and lovers,” Williams said in a video statement. “It’s cheating, and it’s against the law.”
Tavistock Group, which is based in the Bahamas, has publicly declared investments in more than 200 companies across 13 countries, including the US, Mexico and the Caribbean. The group says its art collection includes works by Pablo Picasso, Henri Matisse and Gustav Klimt.
Lewis, who was born in an east London pub, left school at 15, joined the family catering business and went on to build up his own restaurant business. He left the UK for the Bahamas in 1979.
The tax exile built his reputation as a currency speculator when he, like George Soros, bet against the pound in the build-up to Black Wednesday in 1992. However, he suffered a $1bn hit when Wall Street bank Bear Stearns, in which he was an investor, collapsed into a rescue by JPMorgan in 2008.
The currency trader’s profile grew when he took control of Tottenham, buying shares from British businessman Lord Alan Sugar. In 2019, Spurs completed work on a £1.2bn stadium that has increased its revenues, but fans have complained that the club has failed to add much silverware to its trophy cabinet.
This article has been amended since initial publication to clarify the ownership of Tottenham Hotspur
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