Michael Milken

Michael Milken reshaped American corporate finance from a single desk in Beverly Hills. As head of the high-yield bond department at Drexel Burnham Lambert, he turned the disreputable “junk” bond into a mainstream instrument, financing leveraged buyouts and capital-starved companies that the established banks would not touch. By the late 1980s he was the highest-paid financier in the country; Drexel paid him a reported $550 million in 1987 alone, and his influence over the credit markets was so concentrated that his annual Beverly Hills conference was nicknamed the “Predators’ Ball.”

That dominance collapsed under a federal securities investigation that began in 1986 and was advanced by the cooperation of arbitrageur Ivan Boesky. In March 1989 a grand jury returned a 98-count indictment charging racketeering, securities fraud and mail fraud. In April 1990 Milken pleaded guilty to six felony counts of securities and tax violations and agreed to pay $600 million in fines and penalties. He was sentenced to ten years in prison, served roughly 22 months after the sentence was reduced, and was barred for life from the securities industry.

Released in 1993 and diagnosed with advanced prostate cancer that same year, Milken rebuilt a very large fortune through private investing and ventures such as the education company Knowledge Universe, and he poured money and organizational energy into medical research. He founded the Prostate Cancer Foundation and built the Milken Institute into a prominent economic think tank, recasting himself as a philanthropist and convener.

In February 2020 President Donald Trump granted Milken a full pardon, citing his cancer-research philanthropy. His story remains contested: critics see a financier who broke the law and escaped lightly, while supporters point to a record of capital-market innovation and decades of disease-fighting giving. Notably, despite the popular “insider trading” label, the six counts he admitted concerned securities reporting, recordkeeping and tax matters, not insider trading.