• 23 Nov 2010 at 10:53 AM

FBI’s Circling Of SAC Getting Personal

Ed’s note: A previous version of this story included a picture of a woman incorrectly identified as Wendy Cohen Schimel.

As you may have heard, the US government is putting on a holiday spectacular this year called Insider Trading Fest(ivus) 2010. Capping a three year investigation, charges that “could ensnare consultants, investment bankers, hedge-fund and mutual-fund traders and analysts across the nation” are said to be coming any time between now and early next year. Yesterday, Greenwich-based Level Global and Stamford-based Diamondback Capital Management, both headed by SAC Capital alums, were raided by the FBI. The Bureau also recently dispatched two hired guns to an analyst’s home, where they asked him to wear a wire while having a conversation with “this guy” they told him they were going after, that “guy” being someone at SAC, which follows last year’s unsuccessful attempt to get former SAC analyst-cum-informant Choo Beng Lee rehired in order to record chats with noted individuals there. Securities law professor John Coffee told Bloomberg those approached by the feds and asked to cooperate “will get greater leniency if they [deliver] a bigger fish” and while it may be premature to jump to conclusions, the Nancy Drews among us might infer the government has its eye on one fish in particular!

So, let’s just cut to the the chase– in a conference room at FBI HQ’s, you will (most likely) find a bulletin board with a photograph of Steve Cohen in the middle, surrounded by a web of smaller pictures of various people who he previously and currently does business with, with little strings linking everyone.

Mr. Cohen, of course, has not done anything illegal that we know of, but the FBI needs a big kill. And having been unsuccessful in nailing him for anything so far, they’re now getting desperate and attempting to pit blood against blood (by marriage). One of the three SAC alums who founded Diamondback, Rich Schimel, pictured, is not just a former employee of Steve’s but his current brother in law (who is married to SC’s sister, Wendy). We’re told that around the time Schimel left to start Diamondback (along with Lawrence Sapanski and Chad Loweth), he and Steve had a falling out, and it’s unclear if the relationship was repaired in the ensuing years. But if we know the government– and I think we do!– they’re banking on bad blood. The sort of blood that would get someone to show up at Thanksgiving wanting to make all nice-nice and asking his B in the L to lean in a little closer while they have a heart to heart.

But the feds have underestimated this familial bond– Schimel is no Fredo (besides which- even if Rich did wear a wire, there’s nothing improper to overhear. The only hot tip they’ll be privy to is SC’s stuffing recipe).

27 comments (hidden to protect delicate sensibilities)
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Comments (27)

  1. Posted by Diesel7 | November 23, 2010 at 4:07 PM

    I saw Big Stevie outside ASatriales this morning, he didnt look worried

    Plus Gaspo thinks its all garbage so everyone needs to relax

  2. Posted by Guest | November 23, 2010 at 4:12 PM

    This happens all the time in natural gas trading. It’s no big deal. Other than that I have no concerns. UBS sucks.

  3. Posted by TSAhole | November 23, 2010 at 4:18 PM

    If you touch my SAC, I’m going to sue you .

  4. Posted by CurrencyTrader | November 23, 2010 at 4:19 PM

    Steve Cohen will of course be dealing with this crisis the only way he knows how – mainly eating an entire box of chocolate glazed donuts under his desk and sobbing uncontrollably.

  5. Posted by Shallow Thinker | November 23, 2010 at 4:20 PM

    Will they send Mr. Cohen to a temperature controlled prison?

  6. Posted by ChoadyWillard | November 23, 2010 at 4:21 PM

    If I must.

  7. Posted by Mitch Cumstein | November 23, 2010 at 4:21 PM

    “[...] asking his B in the L to lean in a little closer while they have a heart to heart.”

    Levs, you’re getting balsy, trying to implant yourself in familial affairs! Some things are better left to the imagination.

    -Guy That Tries To Perm His Collars In Hopes of Attracting a Certain Female

  8. Posted by Guest | November 23, 2010 at 4:32 PM

    My guess is even if the Feds have the goods on him, they won’t take him alive. The shear logistics of ochestrating a raid on the Cohen manse, and guessing in which one of his 24 bathrooms he’s taking a handful of sleeping pills, is simply mind boggling.

  9. Posted by Mr. Blonde | November 23, 2010 at 4:33 PM

    More like Carlo, not Fredo. Any over/under on how long it is before his feet kick out the windshield of a car in an empty lot in Stamford’s South End?

  10. Posted by Guest | November 23, 2010 at 4:40 PM

    Sucks enough to turn down a job there?

  11. Posted by Voice of Reason | November 23, 2010 at 4:43 PM

    Yep, I’m sure this is all just one big giant cultural misunderstanding…kinda like going to McDonalds and ordering a Falafel or spinning a dreidel in church.

  12. Posted by Anonymous | November 23, 2010 at 4:48 PM

    “More like Carlo, not Fredo. ”

    god damn it, you are right. but Fredo has one name recognition. I’m conflicted.

  13. Posted by Montana | November 23, 2010 at 5:00 PM

    If I’m Stevie, I would think about putting together some serious weapons caches around my casa. Then I’d go to Miami to grab a few hundred Cuban mercenaries to roam my grounds. Then I’d use my Navy Seal connections to learn how to use all the guns and equipment I bought. So then when the FBI and GPD came to raid my house, I could finally live out my Scarface fantasy once and for all.

  14. Posted by Mr Culture | November 23, 2010 at 5:00 PM

    In Russia, Tits Bang You????

    – Guy who is trying to improve his multi-cultural skill set

  15. Posted by Anonymous | November 23, 2010 at 5:08 PM

    He’s a billionaire. No need to do that– just move to Switzerland– worked OK for Marc Rich.

  16. Posted by Montana | November 23, 2010 at 5:18 PM

    Yea, if you want to die like a pussy.

  17. Posted by Guest | November 23, 2010 at 5:28 PM

    um, that’s pretty much the security set up he’s had around his casa for years now.

  18. Posted by Guest | November 23, 2010 at 5:31 PM

    I was going to suggest “Connie’s husband” but that doesn’t have a good ring to it either.

  19. Posted by Mark Madoff | November 23, 2010 at 5:33 PM

    Did someone say deliver a bigger fish?

  20. Posted by Anonymous | November 23, 2010 at 5:38 PM

    Yeah, it’s a tough one- Carlo really is the more accurate character and I
    also hate Part II, so there’s that.

  21. Posted by Gentleman Trader | November 23, 2010 at 5:41 PM

    Stevie has good taste in T-giving meals. White Castle stuffing has been a GT family tradition for years.

    Also…anyone else getting “excited” for their testicle groping appointments today and tomorrow with the local TSA agents?

  22. Posted by Guest | November 23, 2010 at 6:24 PM
  23. Posted by Mr. Blonde | November 23, 2010 at 7:00 PM

    Carlo gets the garrotte from Clemenza at the end of the original, not Part II

  24. Posted by Anonymous | November 23, 2010 at 7:02 PM

    Correct, which I why I would prefer a Carlo reference (ie a Part I
    reference), but it doesn’t seem like there’s a way to make it happen.

  25. Posted by Guest | November 23, 2010 at 8:49 PM

    “Sick fucks”

    Bess, such language…please keep it up.

  26. Posted by Wma | November 26, 2010 at 7:13 PM

    They should definitely nail Dan Loeb – guy’s a douchebag / scumbag, his own employees hate him and think he’s a moron, and the guy’s definitely done some sketchy stuff. Nail one of them (the suckface that goes by Gorinksi or something?) and you’ll have a squealer

  27. Posted by tits | November 23, 2010 at 4:19 PM

    You Bang Me?