Steven A. Cohen, the billionaire investor, is looking to hire a former prosecutor or securities regulator to monitor trading at his investment firm in the wake of the federal government’s insider trading investigation. Mr. Cohen’s SAC Capital Advisors hedge fund, which pleaded guilty to securities fraud in November, is in the process of converting to a family office that will manage mainly $9 billion of his personal wealth. The firm announced its intention to hire a chief surveillance officer to monitor trading in a letter to employees on Tuesday. The firm expects to fill the newly created position in the spring…The letter to employees also described how SAC, after converting to a family office, would consolidate several operating divisions and would announce a new name for the firm sometime in April. [Dealbook]
Wanted: Former Prosecutor To Help Prevent Future Prosecutions Of Whatever SAC Capital Is Gonna Be Called As Of AprilBy Bess Levin
At least one person isn’t happy about the pending insider trading settlement between the government and SAC Capital Advisors LP and isn’t afraid to make that known — anonymously. In an anonymous email to U.S. District Judge Laura Taylor Swain, who is presiding over the criminal portion of SAC’s settlement, the critic had harsh words for the Justice Department and SAC’s billionaire founder Steven A. Cohen. “LTS, you must be tough like [Judge] Rakoff, kill the plea deal now that SAC trader Mathew Martoma is convicted to force DoJ to put Steve Cohen behind bars,” the person wrote. “His billions were made by insider trading and stolen from investors.” [WSJ]
*Assuming you can’t get them imported to the joint.
he's gonna blow!
Over at Dealbook today you will find an article by Matthew Goldstein and Alexandra Stevenson that takes stock of the government’s futile attempts to ensnare hedge fund manager Steve Cohen, in the wake of last week’s guilty verdict against one of his former traders, Mathew Martoma. According to Martoma’s attorney, his client was but a pawn/grain of sand in the Feds’ quest to nail Cohen for insider trading. While the conviction of Martoma was a win for Preet Bharara and Co in that it brought their record against accused insider traders to 79-0, things didn’t turn out precisely as they had hoped, as Martoma never turned on Cohen by revealing the damning details of a crucial 20 minute conversation the two had over the phone, before SAC began dumping its shares of Elan and Wyeth.
Will Martoma ultimately turn on Cohen in an effort to receive a more lenient sentence? It’s possible, though somewhat unlikely, as 1) He hasn’t up to this point and 2) His “testimony is not worth much to prosecutors now unless he has some email document, or other piece of physical evidence to support any version he would present of his conversation with Mr. Cohen. Plus, the revelations that he attached fake Harvard Law transcripts to his applications for prestigious clerkships did not exactly do wonders for his credibility. Obviously this is good news for Cohen, and adding to the ‘everything is coming up roses for the Big Guy’ column is the fact that, amazingly, people supposedly “still want to work [at SAC.]”
Which brings us to the most important part of Goldstein and Stevenson’s piece: the window it give us into one of the more vital and consequential tasks SAC employees find themselves performing daily: Read more »
Jurors in Manhattan have reached a guilty verdict in the insider-trading trial of Mathew Martoma, the former SAC Capital Advisors LP portfolio manager accused of insider trading. The jury said Martoma used inside tips on trades that earned SAC $275 million. [WSJ, earlier]
Defense: Mathew Martoma But A Victim/Pawn/Grain of Sand/Innocent Young Man Cut Down In The Prime Of His Totally Legit Trading Career In Government’s Quest For Steve CohenBy Bess Levin
Former SAC Capital Advisors LP fund manager Mathew Martoma was portrayed by his lawyer as the victim of a “rush to judgment” by prosecutors looking to use him to bring insider-trading charges against his former boss, Steven A. Cohen…“Mathew was just a grain of sand in their haste to make a case against someone who is not even in this courtroom: Mathew’s boss, Steven Cohen,” Richard Strassberg said in his closing argument yesterday in Manhattan federal court. [Bloomberg]
We knew that our time was limited but it wasn’t until this morning that we found out how limited: according to Dealbook, SAC Capital as we know it will cease to exist come mid-March, at which point the firm take on a new name, streamline its “legal entities,” and add a layer of middlemen whose purpose is to make it more difficult for traders to get face time with the Big Guy. Read more »
A judge may have thrown out her RICO claims, but she’s still got breach of fiduciary duty, and if she has to go through 20 more lawyers to make her case, so help that’s what she’s gonna do. Read more »