The good news, if you are Mr. Steve Cohen: you were neither charged nor “mentioned by name” in the criminal complaint against your former employee, Mathew Martoma, who is alleged to have orchestrated “the most lucrative insider trading scheme ever.” The less good news: YOU ARE PORTFOLIO MANAGER A. YOU NEVER WANT TO BE PORTFOLIO MANAGER A!

U.S. officials for the first time Tuesday implicated Steven A. Cohen, the founder of SAC Capital Advisors LP, in an alleged insider-trading scheme they said was the most lucrative ever to be charged…Mr. Cohen…is referred to as “Portfolio Manager A” in an alleged $276 million insider-trading scheme in a civil complaint filed by the Securities and Exchange Commission, according to people familiar with the matter. Both civil and criminal complaints also refer to him as the “owner” of two hedge-fund affiliates involved in the alleged scheme, and depict him as integrally involved in the allegedly illicit transactions…According to the SEC complaint, Portfolio Manager A authorized many of the trades based on Mr. Martoma’s alleged inside information, and rejected the advice of other analysts at his firm that conflicted with Mr. Martoma’s positions. In particular, on July 20, 2008, after Mr. Martoma had learned negative information relating to two pharmaceutical stocks in which SAC and its affiliate had big positions, Mr. Martoma said it was “important” that he speak to Portfolio Manager A, and indicated he was no longer “comfortable” with their positions, according to the civil complaint.

The next day, Portfolio Manager A’s head trader began selling hundreds of millions of dollars of shares in the two companies, and the hedge funds later began executing negative bets against those two companies’ stocks, reaping big profits and saving large losses.

Steve Cohen Implicated In Insider Trading Scheme [WSJ]

63 comments (hidden to protect delicate sensibilities)
Show all comments ↓

Comments (63)

  1. Posted by Guest | November 20, 2012 at 1:37 PM

    10 bucks someone at the SEC is seen wearing a S.A.C fleece signed by A.Rod by weeks end…Takers?

  2. Posted by Steven A. Cohen | November 20, 2012 at 1:44 PM

    fuck…

  3. Posted by Guest | November 20, 2012 at 1:47 PM

    No mention of Little Cat A, B, or C?

    –Guy who just read The Cat in the Hat Comes Back to his kid

  4. Posted by Guest | November 20, 2012 at 1:54 PM

    This is a terrible tragedy. Investors were fleeced.

  5. Posted by guest | November 20, 2012 at 1:56 PM

    Go on.

  6. Posted by Guest | November 20, 2012 at 2:03 PM

    I can think of at least one compliance officer who is going to be SACked.

  7. Posted by Guest | November 20, 2012 at 2:05 PM

    Shamelessly copying the Drudge siren, I see, did you ask for his permission?

    – UBS Intellectual Property Quant

  8. Posted by Guest | November 20, 2012 at 2:05 PM

    Please Matt, do us some charts and some CFA level II analyses on this P&L:

    Economic Inputs

    1- No Bonus in 2009, base pay $250k
    2- $9.38mm Bonus in 2010, base pay $250k
    3- Lawyers fee for a plea- $250k
    4- SEC penalty- $5mm
    5- 18 months in mimimum security lock-up- loss of 18 months income, -$60k
    6- Taxi driving until retirement- 27 years x $50k, $1.35mm

    What is the Expected Value of insider Trading?

  9. Posted by guest | November 20, 2012 at 2:06 PM

    You're an idiot and also new here.

  10. Posted by guest | November 20, 2012 at 2:07 PM

    Never comment again.

  11. Posted by guest | November 20, 2012 at 2:07 PM

    You're not very bright, are you?

  12. Posted by guest | November 20, 2012 at 2:08 PM

    Jojo the idiot circus boy?

  13. Posted by FKApmco | November 20, 2012 at 2:08 PM

    Might I recommend he gets Zambonied, dipped in formaldehyde and stuffed into a Perspex box.

  14. Posted by Guest | November 20, 2012 at 2:09 PM

    Seriously folks. What if they go after Cohen? What happens to his portfolio? Does he close shop? Is there reputational damage if he's practically the only investor in his fund?

  15. Posted by Louis Bacon | November 20, 2012 at 2:11 PM

    what a sac of lies and deceit

  16. Posted by Guest | November 20, 2012 at 2:13 PM

    I noticed that you all called yourselves "guest" in lowercase – next time I comment, I will be sure to abide by the standards and lowercase the first letters of names. Thank you for the advice!

    Til we meet again,
    guest (formerly Guest)

  17. Posted by Guest | November 20, 2012 at 2:14 PM

    SAC needs to merge with Rochdale to survive

  18. Posted by Guest | November 20, 2012 at 2:20 PM

    Best thing for him is to come down with Alzheimer's at this point….

  19. Posted by Guest | November 20, 2012 at 2:20 PM

    Green dot or Red dot on Bloomberg?

  20. Posted by Guest | November 20, 2012 at 2:27 PM

    I'm sorry Bess. I know you must be taking this news harder than anyone.

  21. Posted by Guest | November 20, 2012 at 2:34 PM

    *WHEW*

    – Portfolio Manager B

  22. Posted by IANAL | November 20, 2012 at 2:41 PM

    "obviously no one knows except you me and [HF Owner]"

    Looks real bad, Stevie boy.

  23. Posted by Eliot Ness | November 20, 2012 at 2:42 PM

    Maybe SAC will be seen wearing Presidential cufflinks in the not too distant future.

  24. Posted by Bandersnatch | November 20, 2012 at 2:43 PM

    pmco
    Thanks for the gift certificate! You are a woman of your word and an upstanding member of the Dealbreaker peanut gallery.
    – In love with pmco II

  25. Posted by Adding it Up | November 20, 2012 at 2:45 PM

    "What if they go after Cohen?"

    Current Steven A. Cohen Net Worth: +/- $1 bil
    Less: legal fees re: first wife, SEC settlement, buying all copies of "that" deck of cards": $100 mil
    Net Steven A. Cohen Net Worth: +/- $800 mil

    Sure, ban him from the securities industry – he will just grow MORE powerful, allocating money to his favored new PMs – HE CANNOT BE STOPPED!

  26. Posted by _guest | November 20, 2012 at 2:46 PM

    "Whew."

    -J. Corzine

  27. Posted by Jim Lahey | November 20, 2012 at 2:47 PM

    Maybe McAfee can help by sending an instruction manual for his cardboard escape pod 5000?

  28. Posted by Guest | November 20, 2012 at 2:49 PM

    "Current Steven A. Cohen Net Worth: +/- $1 bil "

    try more like +/- $ 6 bill

  29. Posted by (Keep) Adding it Up | November 20, 2012 at 2:56 PM

    "+/- $1 bil"?…I'll take the over

  30. Posted by Marlboro Prangdune | November 20, 2012 at 2:57 PM

    Cherry top flashing grand mal seizures, commence.

  31. Posted by Guest | November 20, 2012 at 2:58 PM

    Steve Cohen doesn't get out of bed for less than $1 bn/day…

  32. Posted by Adding it Up | November 20, 2012 at 3:01 PM

    Honestly did not care enough to Google it. Whatever, even if they invoiced him for $3 bil, he's got more than enough to live on, even if he attached $100 bills to the bottom of his shoes to use on the rink. He'd be just as fine as an allocator, and he can toss $50 mil a year to charities and be a hero to boot. His only risk is reputational. See: Milken, Michael.

  33. Posted by Sack Lunch | November 20, 2012 at 3:11 PM

    Better sell the shark.

  34. Posted by Guest | November 20, 2012 at 3:13 PM

    Portfolio Manager A needs to merge with [Hedge Fund Owner] to survive.

  35. Posted by bitch came out | November 20, 2012 at 3:20 PM

    ( voice cracking, as in after a major loss at the desk )

  36. Posted by Ping | November 20, 2012 at 3:21 PM

    The acronym is what drove me to work there.

  37. Posted by Mike Milken | November 20, 2012 at 3:24 PM

    He may go down. What do you mean ?

    He does a stint inside, pays a large fine. Industry ban.

    Moves on.

  38. Posted by Portfolio Manager X | November 20, 2012 at 3:27 PM

    What an amateur.

  39. Posted by PermaGuestII | November 20, 2012 at 3:31 PM

    brack·et

    verb (used with object)

    (Gunnery) To place (shots) both beyond and short of a target.

  40. Posted by C. Moose | November 20, 2012 at 3:40 PM

    We have caught the sniper like a duck in a noose. Say it, duck in a noose.

  41. Posted by @ReformedBroker | November 20, 2012 at 3:47 PM

    lol

  42. Posted by JJ | November 20, 2012 at 3:49 PM

    9,10,11,12

    chimp city

  43. Posted by jj jones | November 20, 2012 at 3:50 PM

    9 , 10 , 11, 12

    chimp city

  44. Posted by jj jones | November 20, 2012 at 3:51 PM

    loser ???

  45. Posted by Prison Lingo | November 20, 2012 at 4:20 PM

    What sounds like a a "stint" is what they stick in your clogged arteries. A "stretch" is the time in jail that the Feds stick up your ass.

  46. Posted by Futures | November 20, 2012 at 4:26 PM

    you don't think that frog in your throat thing is accurate ?

    hear it at least once a week.

  47. Posted by Mike Milken | November 20, 2012 at 4:28 PM

    how do they say homosexual ?

  48. Posted by Guest | November 20, 2012 at 4:29 PM

    N/A

  49. Posted by January 28, 2011 | November 20, 2012 at 4:29 PM

    "Mark Haines at CNBC for example, says someone from the network tried to talk to him.
    Cohen told them, "You don't need to be talking to me. I'm on the way down."

    Any thoughts about what that means?"

    Read more: http://articles.businessinsider.com/2011-01-28/wa

  50. Posted by FKApmco | November 20, 2012 at 4:29 PM

    You are welcome Bander. And good job by you for paying it forward. The deal struck today is $100 to Sandy Relief and $150 for Margs and Gimlets.
    xoxo

  51. Posted by Doc | November 20, 2012 at 4:35 PM

    "Stent"…..stick to the prison side of your lingo

  52. Posted by guest | November 20, 2012 at 5:29 PM

    7- Book Deal while in minimum security lock up – $2mm

  53. Posted by EQ in Dallas | November 20, 2012 at 5:31 PM

    Get a fucking room you two

  54. Posted by FKApmco | November 20, 2012 at 5:36 PM

    Get out of our conversation and go fuck yourself you fucking fucktard.
    FKApmco

  55. Posted by Guest | November 20, 2012 at 5:38 PM

    try more like +/- $ 8 bill

  56. Posted by EQ in Dallas | November 20, 2012 at 6:11 PM
  57. Posted by Miami | November 21, 2012 at 5:57 AM

    I'm so sick of hearing about SAC. I've got a much more interesting story: Back when Dan Dorfman was on CNBC, SOROS used to coerce him into moving stocks in his direction by sending child prostitutes to his house while having it videotaped so he could use it against him. There's some inside information for ya.

  58. Posted by FKApmco | November 21, 2012 at 9:33 AM

    For the record EQ, while the above is something I might say, I did not say it. There is an impostor among us.

  59. Posted by EQ in Dallas | November 21, 2012 at 4:02 PM

    Fuck it, I can't count all of your chromosomes

  60. Posted by Rick | November 22, 2012 at 9:08 AM

    I am also sick of this

    How much is the sec spending on this witch hunt? What about the millions of money laundering small businesses and welfare cheats? what about the criminal federal reserve stealing from savers?

    a message to the Obama communist government – fk off already scapegoating wall street for votes

  61. Posted by Stevie | November 22, 2012 at 10:03 PM

    Shark for sale, comes with tank full of formaldehyde. Cash bids only. Must move quickly as I plan to be relocating soon. Don't tell my ex-wife.

    Contact: Stevie@sac.com

  62. Posted by Dougie | November 22, 2012 at 10:05 PM

    Well Stevie, now we know how you feed your family…

  63. Posted by EQ in Dallas | November 26, 2012 at 3:27 PM

    I look into my crystal ball and see a rapidly rising public prosecutor that will be a future client number 10.