Michael Milken

Michael Robert Milken ( born July 4, 1946 in Encino, California) is an American financier and investment banker who was in the 1970s one of the main participants in the creation of the junk bond market ( " The Junk Bond King" ). He was arrested for financial fraud in 1989 and is considered a symbol of greed on Wall Street during the 1980s.


Milken was born in Encino, California. He earned a bachelor's degree with honors from the University of California at Berkeley and an MBA from the Wharton School.

During his MBA studies conducted research on high-yield bonds Milken ("high yield bonds "), which at that time mainly of troubled companies ( " fallen angels " ) were issued. Despite the higher yield only a few investors were willing to invest in these bonds. Milken's research said that the yield was still above average in comparison to the higher risk, and later he was able to build as an investment banker a large market for these bonds.

Since that time, Milken fights against cancer and campaigns for education.

Also in 1993 he founded the non-profit organization " Prostate Cancer Foundation " (PCF ) to life in 2003 he founded the non-profit organization "Faster Cures / The Center for Accelerating Medical Solutions ", which supports the organization, founded in 2004 " Patients Helping Doctors". " Patients Helping Doctors" helps patients to donate tissue samples for research databases.

Together with his brother Lowell and Oracle CEO Larry Ellison 1996, he founded the Education Group Knowledge Universe.

Success on Wall Street

From January 1969 Milken worked for the New York investment bank Drexel Harriman Ripley, following their merger of Drexel Burnham Lambert. He was responsible for non-investment -grade bonds and capital generated returns of up to 100 %. In 1976, he had an estimated income of $ 5,000,000 per year. 1978 Milken shifted his department to California.

Milken expanded the business with high-yield junk bonds at Drexel Burnham Lambert and was one of the triggers for the large number of foreign -funded company takeovers ( leveraged buyouts ) in the 1980s. Through the trust placed in him, he was able to place extensive notes on the financial markets to its customers. He contributed significantly to the success of Drexel Burnham Lambert. The company took over in 1986, a four billion dollars in fees and was the most profitable American investment bank. In the same year, Milken received $ 550 million in salary and bonus.

In June 1989, Milken retired from Drexel and formed his own company, International Capital Access Group.

Financial fraud

1989 sued the New York District Attorney Rudolph Giuliani, on the basis of the RICO Act, Milken due to financial fraud in federal court to; However, even this did not lead to conviction.

After further investigation Milken agreed to plead guilty to five points and to pay $ 200 million fine. More $ 400 million he paid for comparisons in civil litigation. He was excluded for life from securities trading. In 1998 he paid another $ 47 million fine to the SEC because he had cast as a consultant for MCI and Revlon of the suspension. He was not prosecuted for a consultant with the acquisition of Turner Broadcasting System by Time Warner, for which he received $ 50 million as a fee.

Originally Milken was sentenced to 10 years in prison but was released after 22 months in prison in January 1993. His fortune was estimated in 2010 to 2 billion dollars.