CKX acknowledged September 26th in a statement that a “former domestic employee” of CEO Robert Sillerman has been named as a defendant in a civil complaint filed by the Securities and Exchange Commission in federal court.
According to Dowjones Business News, the domestic employee in question is Graham Lefford, who was hired by Sillerman in 1999 as house manager for his Southampton, N.Y., estate.
In 2004, Sillerman split his time between that home and one in Manhattan, the SEC reportedly said. This was also the period when Sillerman began organizing the company that would become CKX, initially by purchasing a penny-stock shell company called Sports Entertainment Enterprises, which was eventually renamed and retooled.
Apparently, Sillerman had fax machines in his house and next to his pool at the Southampton residence, and Lefford would often retrieve them for his boss, according to the SEC. Within minutes of reading about the acquisition of the shell company, the butler bought shares in the company, according to the Business News.
The stock skyrocketed in December when Sports Entertainment Enterprises announced it had been acquired. The butler sold his penny stock for $10 a share and reaped $48,525 profit on his $600 investment, the News said.
The SEC is reportedly seeking a court order requiring Lefford to return his $48K and pay a civil penalty.