Yup. Proving insider trading without any kind of paper trail is nearly impossible.
And getting Icahn on anything will be pretty tough, too, because he doesn't trade on insider info, has no need to, nor could he with the amounts of money he puts into play. He'd be the guy handing out the insider info. That is a hard link to create, and even if they can, they are going to have an impossible time demonstrating that he benefited in any way.
Icahn's M.O. is to accumulate large blocks of stock up until the time he has to disclose his stake. Then he goes on a public campaign to try to get the company to do things he wants to boost the value of his stock -- share buybacks, dividends, acquisitions, a sale, etc. He threatens the board of directors -- and he is good at it -- and gets them to do what he wants, or he goes to battle and replaces them with his own people. Usually when the market finds out that Icahn has accumulated a lot of stock in a company, the stock price jumps just on that news. Which is what happened in this case, with Clorox, and it sounds like Walters and Mickelson rode his coattails -- the way LOTS of people have over the years.
The Feds going after this stuff is feckless and stupid. Icahn discovered twitter a year ago and has been active on it. Every time he tweets related to a company he has built up a stake in, the stock price moves. He toys with the markets with it, and seems to have a ball with it in a cagey sort of way. Should that be made illegal too?
The SEC is pitiful in its execution of the things it tries to regulate. The concept of insider trading is muddled and selective. Punish people who steal info or breach contracts to hold info in confidence. Theft or lying. But why do we punish people who trade on the basis of valuable knowledge? In any other endeavor, we expect people to try to gain knowledge for their advantage and we certainly don't demonize someone for using information to make a smart purchase.
