Point72 Asset Management, AKA the hedge fund formerly known as SAC Capital, whose largest client by far is a guy who answers to the name Steve Cohen, has turned in some pretty decent performance so far this year, despite a series of events that have led it to do stuff like, among other things, monetarily compensate employees for staying on the right side of the law. Read more »
Steve Cohen Introduces Incentive Bonus For Employees Who Refrain From Insider Trading (No, Really, This Is Actually Happening)By Bess Levin
Time was, the unofficial policy at (the hedge fund formerly known as) SAC Capital was that one could earn a pretty penny come bonus season if one made the firm a ton of money, and if that money happened to be made through material non-public information well…whatyougonnado? At SAC Capital 2.0 AKA Point72 Asset Management, however, insider trading is not only frowned upon, it’s both officially and unofficially a bad idea and one that could cost you big time on payday (though one would obviously be fired before that, unless payday is the day they get caught).
But just because the company handbook has been rewritten, or Steve Cohen has held a town hall where the words “If we catch you insider trading, I’ll stick my hand down your throat and rip out your spleen” have exited his mouth, or the hedge fund’s propriety trading software has been rewired so that a cartoon Cohen pops up on the screen and says “Remember, I can make it look like an accident” before any trades are placed, doesn’t mean that people can change their ways in a day. Old habits die hard, particularly at a place where those old habits could score you 8 figures a year.
Which is presumably why* someone at Point72 came up with this: Read more »
Point72 Asset Management Adds Another Layer Of “Accountability” Between Steve Cohen And Would-Be Insider TradersBy Bess Levin
Billionaire Steven A. Cohen is reorganizing the equities business of his Point72 Asset Management investment firm into seven units to improve accountability. The seven units, organized along industry and geography lines, will each be run by a sector executive, according to a memo sent to employees today from Point72 President Douglas Haynes. The executives will supervise all money managers within their unit and be assisted by a sector executive officer overseeing the group’s analysts, the memo said. Each unit will have officers overseeing compliance, risk and research. The changes are effective immediately. [Bloomberg]
As you’ve probably heard, yesterday afternoon Mathew Martoma née Thomas was sentenced to 9 years in prison for orchestrating “the most lucrative insider trading scheme ever” during his time at SAC Capital. Understandably upset and perhaps having also read the civil complaint in which their son’s boss was identified as “Portfolio Manager A,” mom and dad had this to say:
Speaking on the sidewalk outside the old federal courthouse in Lower Manhattan, Mr. Martoma’s parents said he had been wrongly convicted. The couple asked why Mr. Martoma’s former boss, Steven A. Cohen, the billionaire investor who founded SAC, was not also charged with insider trading if their son had done something wrong.
“…the man who made all the money is on a yacht, my son is going to jail.”
While there is obviously a touch of bias involved here, these statements seem relatively reasonable, whereas the arguments offered for why Martoma/Thomas was found guilty… Read more »
Now, people close to Cohen say he has quietly and methodically launched a multi-pronged effort to eventually make his full return to the hedge fund business, even if many legal experts say the odds are low that he will prevail. “I would say Steven Cohen’s chances are about as good as Michael Milken’s would be” for returning the securities business, said Columbia Law School professor John Coffee, referring to the tarnished junk bond pioneer. Still, Coffee added, “a lifetime ban allows you to reapply five years later for readmission,” meaning it’s not impossible. [FBN]
Something you probably know about Steve Cohen is that the last number of years have not been so kind to him. Almost a dozen of his employees have been charged with and convicted of securities fraud. The government won’t let him manage outside money. He had to rename his fund, rendering a warehouse full of SAC fleeces useless. No one will buy his apartment. The New York Times thinks his house is only 14,000 square feet. He just wrote a check for $848 million, money that could’ve gone toward Super Duper Weenie products or Guy Fieri cookbooks. It’d be enough to make anyone want to get into bed, pull the covers over their head, and shut out the world, which is exactly what Cohen was doing earlier this year.
So when his wife wanted to attend a little party in East Hampton this weekend, it surely took some convincing. “It’ll be good to get out, Steve,” she probably said. “I bet they’ll serve cocktail franks.” “Alec Baldwin will be there; you loved him in Glengarry Glen Ross and Along Came Polly.”
One or all of these temptations clearly struck a chord, and Cohen decided that yes, he would be nice to get out and mingle. Unfortunately, he didn’t realize that Bloomberg‘s exacting eye would be watching. Read more »
Steven A. Cohen proved to be a stickler for the letter of the law when it came to paying the criminal penalty imposed on his former hedge fund as part of its guilty plea on insider trading charges. On April 10, Judge Laura Taylor Swain of Federal District Court in Manhattan gave Mr. Cohen’s SAC Capital Advisors up to 90 days to pay the $848 million penalty, part of an overall $1.2 billion criminal settlement reached with prosecutors last November. On Tuesday, the 90th day since Judge Swain accepted the firm’s guilty plea, Mr. Cohen’s firm made that payment, according to court records. [Dealbook]