Tycoon’s Butler Accused of Insider Trading

Federal regulators say the former butler of businessman Robert F.X. Sillerman illegally profited in stock trading by using confidential information regarding his boss’ acquisition plans.

Through his lawyer, Graham J. Lefford disputed the allegations by the Securities and Exchange Commission.

The SEC on Tuesday announced a civil lawsuit charging Lefford with illegal insider trading in shares of Sports Entertainment Enterprises Inc., which Sillerman acquired in December 2004 in a $100-million deal.

Sillerman, a prominent media and entertainment entrepreneur, bought the then-dormant public shell company as a vehicle to acquire the commercial rights to Elvis Presley’s name and image from the Presley estate.

The SEC, in the suit filed in federal court in Manhattan, says Lefford made $48,525 in profit on a $600 investment by selling shares of the company after they skyrocketed after the announcement of the deal.

Sillerman amassed a fortune estimated at nearly $1 billion from buying and selling media properties. In addition to the Elvis rights, his company, CKX Inc., also owns the “American Idol” TV show and other entertainment ventures.

The SEC alleged that, in the summer of 2004, as Sillerman was negotiating with the Presley estate, Lefford found out about the deal from documents faxed between Sillerman’s Manhattan office and his summer residence on Long Island, where Lefford was the house manager.

On Aug. 12, according to the SEC, Lefford bought 5,000 shares of Sports Entertainment at 12 cents a share. After the deal was announced in December, the stock price jumped to $9.10.