The U.S. Securities and Exchange Commission said it was dropping its civil insider trading case against former SAC Capital Advisors LP portfolio manager Michael Steinberg in the latest reminder of the government’s suddenly-shaky prosecution of the hedge-fund firm.
The SEC’s move this week had had been expected after Manhattan U.S. Attorney Preet Bharara last month moved to dismiss criminal insider-trading charges against Mr. Steinberg, citing an appeals court ruling that overturned the former fund manager’s 2013 conviction.
Now, since he’s had almost a year to work on it, I’m sure Mike’s kicked around a few options for his post-conviction-that-wasn’t hedge fund. He's had time in between rebuilding sufficiently arms-length networks and weekly champagne toasts with the Big Guy, but we figured we’d offer a few choice monikers for him to mull over.
- What Does Not Kill Me Makes Me Stronger Capital Management
- You Ain’t Seen Nothing Yet Funds
- Black Edge Advisors
- Chiasson Newman Steinberg LLC
- Insider Investment Group
- Material Benefits Fund Management
- Legally Tested Strategies Associates
- Not A Stool Pigeon Capital
While Steinberg makes some phone calls to prime brokers and third-party marketers, stool pigeon Richard Choo-Beng Lee awaits word on what his reward for being the guy who would have brought SAC down if pesky courts hadn’t decided that what SAC did probably wasn’t illegal will be. Elsewhere, prosecutors are waxing poetic about what could have been, had they been able to get Steve Cohen into the dock.
In a court filing on Wednesday, federal prosecutors said that the witness, Richard Choo-Beng Lee, would have been an important one if Steven A. Cohen had mounted a legal challenge to the securities fraud indictment that his former hedge fund, SAC Capital, pleaded guilty to almost two years ago.
Authorities said that Mr. Lee, a former analyst at SAC who is known as C.B., would have testified at a trial about the “widespread nature of insider trading at the hedge fund.” He also would have “provided compelling evidence that SAC Capital’s leadership fostered an environment that, at minimum, tacitly encouraged illegal insider trading.”
Ex-SAC Employee Accused of Insider Trading Nabs Reprieve from SEC [WSJ MoneyBeat blog]
Cooperating Witness in SAC Trial to Be Sentenced [DealBook]