Skip to main content

Steve Cohen Introduces Incentive Bonus For Employees Who Refrain From Insider Trading (No, Really, This Is Actually Happening)

  • Author:
  • Updated:

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:

Starting next year, some of the firm’s managers and analysts can earn an extra bonus of as much as 4 percent of compensation if they demonstrate adherence to the firm’s compliance policy** and ethical standards, contributions to the community and repeated strong investment performance, Mark Herr, a spokesman for Stamford, Connecticut-based Point72, said today in a telephone interview. “Are you setting a proper tone and example on compliance and doing the right thing? Are you setting the right tone and doing the right things to develop your analysts?” Herr said of the new program, called “Rewarding What Matters.” Employees can earn the bonus by, for example, raising issues with compliance, suggesting policy changes and serving on charitable boards.

Cohen to Reward Ethical Behavior With 4% Bonus at Point72 [Bloomberg]

*Also, obviously, so they can say "We reward good behavior and punish bad, etc, etc, etc."
**Typically, y'know, a condition of a person's employment at his or her firm.


By kloniwotski (Flickr) [CC BY-SA 2.0], via Wikimedia Commons

Steve Cohen Ain't Afraid Of No Stinkin' Brexit

Steve Cohen is thisclose to getting the Union Jack tattooed to his lower back.

Steve Cohen: Stop Copying Me

Point72 was down eight percent in February because of YOU.

Steve Cohen May Bust His Tea Set Out Of Archives

Lord Cohen has a nice ring to it, no?