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January 28, 2023

Is KPMG Secretly Worried About This Phil Mickelson Insider Trading Situation?

There is an interesting article in BloombergBusinessweek today about some of Phil Mickelson's sponsors turning their backs on him due to Phil's insider trading probe.

As we already know, KPMG has expressed their utmost faith and support for Phil, saying "We have had a very strong relationship with Phil for a number of years, and we fully expect it to continue. We have great respect for him.”

For Phil Mickelson, it may not be that easy:

“Insider trading is about cheating, and golf is about not cheating,” said Atlanta-based sports attorney David Cornwell, who has defended athletes including baseball players Alex Rodriguez and Ryan Braun, and quarterback Ben Roethlisberger of the Pittsburgh Steelers, in separate scandals.

Another big sponsor, Callaway, echoes KPMG's statement:

“We have had a long-standing partnership with Phil and value our relationship with him,” Carlsbad, California-based Callaway said in a statement. “He has always acted with the utmost professionalism and integrity in our dealings with him.”

Because the issue involves investing and not golf, Callaway doesn’t stand to suffer much damage, Casey Alexander, a New York-based analyst at Gilford Securities Inc., said in a telephone interview.

“Callaway would stick behind him until they slammed the jail cell door shut,” Alexander said. “There’s such a degree of public goodwill towards Phil, people will say he’s innocent until proven guilty.”

Last I checked, Casey Alexander, New York-based analyst at Gilford Securities, Phil is innocent until proven guilty regardless of his so-called "public goodwill," but thanks for that insight.

Anyhoo, sports attorney David Cornwell is a tad skeptical Phil's big sponsors are as supportive behind the scenes as their public statements make it appear:

“Despite what Barclays and KPMG may say, you’ve got to know that they are watching this thing closely,” Cornwell said. “For the financial services companies, that’s just a blemish they can’t afford to have.”

Phil earns more than $30 million a year in sponsorships, so this naturally begs the question why a squeaky clean, trustworthy dude like Lefty would profit from information he knew was non-public and material to the company in question.

As for his reputation, I don't think he's all that worried. Even in the age of villifying banksters and crooked politicians, and even without any proof Phil did anything wrong, some have even gone so far as to call him a hero. A hero! Lord knows KPMG could use more of those.

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