Michael Milken

At Birmingham High School in Encino he was the head cheerleader, and he worked a diner shift besides. Sally Field and Michael Ovitz were classmates. He went to Berkeley, graduated in 1968 with highest honors and a Phi Beta Kappa key, and found there the work that organized the rest of his life: credit studies by W. Braddock Hickman, a former president of the Cleveland Fed, showing that a portfolio of bonds rated below investment grade returned more, adjusted for risk, than a portfolio of safe ones. Milken took an MBA at Wharton, landed a summer job at Drexel Harriman Ripley in 1969 through his professors, and joined the firm as director of low-grade bond research, with some capital of his own to trade.

The market for high-yield debt was largely his construction. After the 1973 merger with Burnham and Company he persuaded Tubby Burnham to let him start a high-yield trading department. In 1978 he moved the operation from New York to Century City. His network of buyers, insurers and savings and loans among them, could absorb enormous issues on short notice, so Drexel could finance takeovers no commercial bank would touch. Kohlberg Kravis Roberts and the greenmailers ran on his paper. Over one four-year stretch in the late 1980s his compensation exceeded 1 billion dollars, a record for American income.

The gap between the charge and the conviction is the whole of his case. In March 1989 a grand jury indicted him on 98 counts of racketeering, mail fraud and securities fraud, and the government sought 1.845 billion dollars in forfeitures. What he pleaded guilty to on April 24, 1990 was six felonies, none of them insider trading and none of them racketeering: three reporting and disclosure violations arising from trades with Ivan Boesky, two tax counts involving a client, and one count of conspiracy to commit the other five. He paid 200 million dollars in fines, settled with the SEC for 400 million, and accepted a lifetime bar from the securities industry. Judge Kimba Wood sentenced him to 10 years and said he had been willing to commit only crimes unlikely to be detected.

He went to prison in March 1991, served 22 months of a sentence cut to two years, and was diagnosed with advanced prostate cancer the month he got out. Then the institutions: the Milken Institute, the Prostate Cancer Foundation, a school of public health at George Washington University, a museum beside the White House opened in 2025. The verdict has not settled. Sources for James B. Stewart's Den of Thieves said he routinely sought markups several times the legal maximum. His appellate lawyer Harvey Silverglate argues the most profitable moves were lawful and looked criminal only because they were new. Trump pardoned him on February 18, 2020.

Michael Milken's life against the full span of the corpus — the fading end marks a life still in progress.

• Drexel high-yield bond department company
  Started after the Drexel-Burnham merger — it soon returned 100 percent on investment 1973
• Milken Family Foundation company
  Founded with his brother Lowell — source of the Milken Educator Awards 1982
• Milken Institute company
  Economic think tank in Santa Monica, founded the year he entered prison 1991
• Prostate Cancer Foundation company
  Founded the year of his own diagnosis — by 2010 the largest private funder of prostate cancer research 1993
• Knowledge Universe company
  Education company founded with Lowell Milken — parent of KinderCare, sold in 2015 1996
• Milken Center for Advancing the American Dream building
  Museum opened next to the White House in September 2025 2025

• 1968 aged ~22 Graduates from Berkeley with highest honors At Berkeley he read W. Braddock Hickman's credit studies, which found that portfolios of below-investment-grade bonds returned more, adjusted for risk, than investment-grade ones.
• 1978 aged ~32 Moves the high-yield bond operation from New York to Century City The junk bond market was now run out of Los Angeles.
• 1986 aged ~40 Ivan Boesky pleads guilty and names him Boesky's cooperation set off an SEC probe of Drexel and a criminal investigation by U.S. Attorney Rudy Giuliani.
• March 29, 1989 aged 42 Indicted on 98 counts of racketeering, mail fraud and securities fraud The government sought 1.845 billion dollars in forfeitures and indicted his brother Lowell alongside him.
• February 13, 1990 aged 43 Drexel Burnham Lambert files for Chapter 11 The first Wall Street firm forced into bankruptcy since the Depression.
• April 24, 1990 aged 43 Pleads guilty to six counts of securities and tax violations Not to racketeering and not to insider trading. As part of the deal the case against his brother was dropped.
• November 21, 1990 aged 44 Judge Kimba Wood sentences him to 10 years She also imposed 200 million dollars in fines. A separate SEC settlement took 400 million more and barred him from the securities industry for life.
• 1993 aged ~47 Leaves prison after 22 months and is diagnosed with advanced prostate cancer The sentence had been cut to two years. He founded the Prostate Cancer Foundation the same year.
• February 18, 2020 aged 73 Pardoned by President Donald Trump The pardon did not restore his trading license — he would have to apply for a new one to trade securities again.

• Ivan Boesky 1937–2024
  The 1980s insider trading scandal and the cooperation that brought down Michael Milken implicated by
• Donald Trump b. 1946
  Businessman, media personality, and 45th and 47th president whose populist movement transformed American politics. pardoned by
• Jay Gould 1836–1892
  Controlled major railroad and telegraph systems through aggressive stock manipulation. forerunner
• Bernie Madoff 1938–2021
  Financier who ran the largest Ponzi scheme in history — costing investors tens of billions of dollars. later Wall Street prosecution