Phil Mickelson named in SEC insider trading lawsuit

The Securities and Exchange commission named Phil Mickelson in a lawsuit on Thursday morning alleging the five-time major winner made $931,000 off insider trading information back in July 2012. The urging to buy stock in Dean Foods, Inc. allegedly came from notorious gambler Billy Walters, who is being criminally charged with insider trading along with Dean Foods chairman Thomas Davis.

The suit names Mickelson as a “relief defendant,” meaning the SEC would like to recoup the “ill-gotten gains as a result of others’ illegal acts.” According to Phil’s attorney, an arrangement to return that $931K has already been made.

Mickelson was urged by Walters to buy the stock based on “material nonpublic information” that Walters possessed. He then bought 200,240 shares and used the profits to repay a debt to Walters. According to the suit, Mickelson purchased $2.4 million in stock from three brokerage accounts that previously had less than $250k collectively on their balances. Mickelson had never previously traded Dean Foods stock. The stock rose 40 percent a week later largely based on a healthy second-quarter earnings report.

Mickelson’s attorney issued the following to Golf Channel’s Will Gray, stating that his client has already agreed to return the money he made from the trade and also feels “vindicated.”

”The SEC has filed a civil complaint against certain individuals, including an acquaintance of Phil’s, but that complaint does not assert that Phil Mickelson violated the securities law in any way. On that point, Phil feels vindicated.

“At the same time, however, Phil has no desire to benefit from any transaction that the SEC sees as questionable. Accordingly, he has entered into an agreement with the SEC under which he will return all the money he made on that 2012 investment.”

Mickelson is not playing this week in Dallas and probably won’t make another start on the PGA Tour until the Memorial, which is the same event where news of this SEC and FBI investigation came out two years ago. Back then, Mickelson maintained he was fully cooperating with the FBI and that he had “done absolutely nothing wrong.”