Nevada gaming regulators continuing investigation of media mogul Barry Diller

April 6, 2022 2:39 PM

Nevada gaming regulators continuing investigation of media mogul Barry Diller

Photo: By World Travel & Tourism Council - David Scowsill interviews Barry Diller, Chairman and Senior Executive of IAC & Expedia, Inc., CC BY 2.0,
  • Buck Wargo, CDC Gaming Reports
April 6, 2022 2:39 PM
  • Buck Wargo, CDC Gaming Reports
  • Nevada
  • Other

The Nevada gaming regulators are continuing their review into the licensing of billionaire media mogul Barry Diller who remains under investigation for insider trading by the Securities and Exchange Commission and Justice Department.

The matter did not appear on Wednesday’s monthly meeting agenda, and Board Chairman Brin Gibson did not bring the issue up for any scheduling.

During a March meeting, Nevada Gaming Commission Chair Jennifer Togliatti paused the licensing application process involving IAC Chairman Diller in light of the investigation that arose after the Gaming Control Board on March 2nd recommended his licensing (and that of CEO Joey Levin) for a 14% ownership stake in MGM Resorts International.

Togliatti said on March 17th that the process was postponed for more investigation by the Nevada Gaming Control Board on the suitability of licensing, with the matter to return at the April 21st Commission meeting.

“It’s still under review,” said Michael Lawton, a senior economic analyst who serves as a spokesman for the board. He didn’t provide any further details of the review or the timeline.

The Wall Street Journal reported that Diller, fellow media mogul David Geffen, and Diller’s stepson Alex von Furstenberg, acquired a large amount of shares of Activision Blizzard stock days before the video game maker agreed to be acquired by Microsoft for $68.7 billion. Activision shares soared on the news of the deal.

Diller has since denied the accusations of insider trading, saying they had no advance knowledge and acted because they thought Activision was undervalued with the potential of going private or being acquired. He called it a lucky bet.

“And, if we had any such information, we would never have traded on it – it strains credulity to believe we would have done so three days before Microsoft and Activision made their announcement,” Diller said in a statement to CNBC.

Last week, the Journal reported that authorities are looking at least one meeting between the chief executive of the video game company, Bobby Kotick, and von Furstenberg. A week later on January 14th, the trio bought options to purchase Activision shares at $40 each. Microsoft Corp. moved to acquire Activision shares for $95 a share.

“We had zero knowledge of that transaction, and it belies credulity to think that if we did we would have proceeded,” Diller told the Journal last week. “It’s equally unlikely to believe Mr. Kotick, a sophisticated professional, in a social breakfast with Mr. von Furstenberg and his wife would have told them of the pending transaction.”

The Journal reported that the three men had an unrealized profit of about $59 million on an options trade. The Justice Department has undertaken a criminal probe to determine whether insider-trading laws were violated and the SEC is doing a civil investigation.