As you may have heard, SAC Capital is facing some legal trouble at the moment. In addition to the nine current or former employees who have “been linked to insider trading while working at the firm, including four who have pleaded guilty to crimes,” it’s apparently not out of the realm of possibility that the feds will go after founder Steve Cohen on RICO charges. In light of all that, it’s not so shocking to hear that some clients are contemplating submitting redemption requests for the June 3 deadline, on top of the $1.7 billion investors requested to pull earlier in the year. Then you have Ed Butowsky, who is 1. Thinks now more than ever is the time to double down on the Big Guy and 2. Can’t wrap his mind around the notion that investors would look at SAC and see anything but a surefire win.

“I’m thinking about putting more money with him,” said Ed Butowsky, managing director at Chapwood Capital Investment Management, who manages $1 billion in client money. The Dallas-based adviser did not say how much his wealthy clients have invested with Cohen’s SAC Capital Advisors, but said the figure tallies into the tens of millions. “Stevie Cohen is the Michael Jordan of hedge fund managers,” Butowsky said, comparing the billionaire trader’s success in the markets to the feats of the legendary professional basketball star. “I’d be a fool to take out money.”

Also firmly on Team Steve is Anthony Scaramucci, who had this to say to Dealbook: “A lot of guys, when bombs are going off, you figure out very quickly who your friends are in the trenches. Most friends run from bullets, but your best friends run toward them. I have enormous amount of respect for the guy, and I think he’s misunderstood.”

Scandal or not, one SAC investor can’t get enough of Steve Cohen [Reuters]

15 comments (hidden to protect delicate sensibilities)
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Comments (15)

  1. Posted by Edwin Lefevre | May 22, 2013 at 6:00 PM

    More like the Barry Bonds or Lance Armstrong…

  2. Posted by Guest | May 22, 2013 at 7:33 PM

    Geez and with 9 employees charges with fraud. Not 1, but 9. Scaramucci only needs people to show up for next years SALT.

  3. Posted by Turnip Truck | May 22, 2013 at 9:35 PM

    I hear Steve also has the strong backing of I.P. Freeley Management.

  4. Posted by Quant me maybe ... | May 22, 2013 at 9:41 PM

    I prefer to think of it as less than 10%

  5. Posted by quant me maybe... | May 23, 2013 at 8:24 AM

    Serious question — If he and his firm are prosecuted under the RICO statutes, can the Feds seize the funds under management?

  6. Posted by davidrusso | May 23, 2013 at 10:01 AM


  7. Posted by quant me maybe... | May 23, 2013 at 10:27 AM


  8. Posted by davidrusso | May 23, 2013 at 10:31 AM

    clarification – no, unless a specific investor was accused of knowing about (and therefore being part of, knowing = complicit in RICO) the conspiracy. huge stretch, but theoretically possible.

  9. Posted by quant me maybe... | May 23, 2013 at 10:50 AM

    Then I expect to see Matt Levine deposed. Matt's theory is that you hire outperforming hedge funds to do the dirty work for you — You invested with Madoff because he was front running and that's how he always beat the market and so on and are therefore implicitly 'knowing'. I'm also pretty sure Matt can prove just about any theory with enough screen space.

    — Guy who works at a hedge fund and was pretty sure, but not certain, that most of us are pretty much math and software geeks (except the sales guys and lawyers).

  10. Posted by PermaGuestII | May 23, 2013 at 11:23 AM

    Honestly, enough already with the fucking war metaphors. You're sitting behind a desk staring at numbers on a Bloomberg terminal, not repelling an enemy infantry attack at Bellau Wood.

    -guy whose late father was a captain, USMC before going to Wall St

  11. Posted by Bill Pullman | May 23, 2013 at 11:53 AM

    Watch Too Big to Fail recently?

    You’re getting out of a Mercedes to go to the New York Federal Reserve, you’re not getting out of a Higgins Boat on Omaha Beach. Keep things in perspective.

  12. Posted by JJ Minahann | May 23, 2013 at 1:30 PM

    Scaramucci would invest with Madoff if he could

  13. Posted by FridyFromiss | May 23, 2013 at 1:31 PM

    so says the Chimp

  14. Posted by Molested By Yetis | May 23, 2013 at 1:41 PM

    Misunderstood? He's a fund manager, not Charlie Sheen or Bigfoot.

  15. Posted by Guest | May 27, 2013 at 5:09 PM

    A poor bull standing outside is dragging the firm down.