Tags: Elan, insider-trading, Mathew Martoma, SAC Capital, SEC, Steve Cohen, Wyeth
The thing is that when you run a hedge fund and “At least nine current or former … employees have been linked to insider trading while working at the firm, including four who have pleaded guilty to crimes,” the SEC really ought to charge you with “fail[ing] reasonably to supervise” your employees, no? At least? Whether or not you were insider trading yourself, you weren’t exactly “continuing to maintain a first-rate compliance effort woven into the fabric of the firm.”
So my first reaction to the SEC’s case against Steve Cohen was “what took so long” but then I read the complaint and it is worth the wait, full of information that we haven’t seen before and that is … awkward. Here is the best of it, emphasis added for Steve’s own words: Read more »
Tags: Andrew Ross Sorkin, Fabrice Tourre, greed, insider-trading, insidious cultures of greed, Labaton Sucharow, SEC, surveys, Wall Street greed
Labaton Sucharow is a law firm whose business consists of getting disgruntled financial industry employees to sue their employees for various bits of naughtiness, and taking a cut of whatever money those disgruntled employees can get from a lawsuit or settlement. One of their clever marketing techniques is to hire a survey firm to identify financial services employees willing to talk shit about their employers on the internet,1 because those employees are a promising source of money for Labaton Sucharow. In fact only about a quarter of those employees actually have anything negative to report, and presumably not all of that is lawsuit-worthy, but marketing is hard and you shouldn’t expect a particularly high hit rate. The trick is to just get a lot of at-bats and something will eventually pan out.
Also the PR is amazing? Here is an Andrew Ross Sorkin column titled “On Wall St., a Culture of Greed Won’t Let Go” that sort of takes this survey as a fact about the world rather than a marketing document, so is all like “oh you and your greed, Wall Street!” Read more »
Tags: go-getters, insider-trading, lawyer-on-lawyer-violence, Matthew Kluger, Michael Steinberg, SAC Capital Advisors
There are all sorts of metrics to determine how bad an insider-trader you were. How many trades did you make on secret information? How many different securities? How much money did you make for/save Steve Cohen? My personal favorite, however, is severity of sentence, and on that count, Matthew Kluger is still the worst insider-trader in U.S. history.
Kluger received the longest insider-trading sentence this side of Raj Rajaratnam, a dozen years, in part because the lawyers who prosecuted him and the lawyer who sentenced him were offended that he was giving lawyers a bad name. Well, the lawyers who decided his appeal concur with their peers. Read more »
Tags: Amgen, insider-trading, Onyx Pharmaceuticals, SEC
A thing that the SEC sometimes does now is
- notice when an anonymous foreigner buys a ton of otherwise thinly traded short-dated out-of-the-money call options just before a company announces big merger news that pushes the stock way up and makes those options suddenly hugely valuable, and
- go to court to take away the anonymous foreigner’s possibly ill gotten gains.
What do you think of that? Like, on the one hand, my aesthetic sensibilities are offended, and my sense of fair play: really they ought to have some evidence of insider, as opposed to just lucky, trading. On the other hand it does seem like good police work, and if the anonymous foreigners want their money back they can always show up and dispute the SEC’s charges.1
Certainly the latest case, where the SEC froze two trading accounts of shadowy offshore figures who went and bought a lot of call options on Onyx Pharmaceuticals two weeks ago, just before Onyx announced last Sunday that it had received and rejected an acquisition proposal from Amgen, is pretty suspicious. From the SEC’s complaint: Read more »
Tags: Incremental Capital, insider-trading, Octopussy, Second Circuit Court of Appeals, Zvi Goffer
The U.S. Second Circuit Court of Appeals agrees that he may have been ordered to pay a little bit too much in forfeiture over his little $10 million insider-trading scheme. Unfortunately, the same court thinks 10 years in prison sounds just about right. Read more »