Wall Street titan Carl Icahn is the victim of a short seller

Activist investor Carl Icahn is a legendary figure on Wall Street. Credit: REUTERS/Brendan McDermid

Karl Icahn, one of Wall Street's best known activist investors, was targeted by a short seller who accused the billionaire of inflating the value of his empire.

Hindenburg Research blamed a hedge fund manager in running a «Ponzi-like economic structure.» through his $15 billion Icahn Enterprises fund and claimed it was overvalued by at least 75%.

The short seller added: “We think Wall Street legend Icahn made a classic mistake. by taking on too much leverage in the face of constant losses: a combination that rarely ends well.”

Shares of Icahn Enterprises, listed on the Nasdaq, fell 24% after the release of the Hindenburg report.

This is the third major company to be targeted by the Hindenburg this year. In January, the seller launched a furious attack on Indian billionaire Gautam Adani's business empire, accusing him of corporate fraud. The company denied the allegations.

Last month, a short seller targeted Block, a US-based crypto payments company run by co-founder and former Twitter CEO Jack Dorsey.

In his latest attack on Icahn Enterprises, Hindenburg raised questions about the company's dividends and its recent funding.

The report stated: «Icahn used money raised from new investors to pay dividends to old investors»,

Hindenburg said in the report. “Economic structures like Ponzi are sustainable only to the extent that new money is willing to risk being the last one to hold the bag.”

He said he expects Icahn Enterprises to cut its dividend. or eliminated unless investment performance improves.

Icahn Enterprises was contacted for comment.

Mr. Icahn remains one of Wall Street's most notorious activist investors and corporate raiders .< /p>

In 1985, he was accused of «stealing assets» by acquiring a controlling interest in Trans World Airlines, one of the most famous carriers in the world.

Recently, he had a conflict with Blackrock. CEO Larry Fink. In a 2015 debate, Mr. Icahn denounced Mr. Fink's claims that share buybacks should not be made just to appease activists as «an offer to sell BlackRock» and criticized the firm for its exchange-traded funds.

Mr. Icahn was a vocal supporter of Donald Trump's 2016 presidential campaign. Before running for the Republican nomination, Trump said Icahn would be nominated for Secretary of the Treasury and then chose Steve Mnuchin.