SEC charges SAC's Steve Cohen
By Lawrence Delevingne, Rob Copeland
Fri Jul 19, 2013
SAC: "The SEC's administrative proceeding has no merit. Steve Cohen acted appropriately at all times and will fight this charge vigorously."
The Securities and Exchange Commission has filed direct
SAC Capital Advisors founder Steve Cohen, a major
development in a long-running investigation around
insider trading at the well-known hedge fund
||Steve Cohen (Photo:
The SEC charged Cohen "for failing to supervise two senior
employees and prevent them from insider trading under his
watch," according to a
press release from the agency. If convicted, Cohen could
face "financial penalties, a supervisory and financial services
industry bar, and other relief."
"Hedge fund managers are responsible for exercising appropriate
supervision over their employees to ensure that their firms
comply with the securities laws," said Andrew J. Ceresney,
co-director of the SEC’s Division of Enforcement.
"After learning about red flags indicating potential insider
trading by his employees, Steven Cohen allegedly failed to
follow up to prevent violations of the law. In addition to the
more than $615 million his firm has already agreed to pay for
the alleged insider trading, the Enforcement Division is
seeking to bar Cohen from overseeing investor funds."
SAC countered with a strong rebuttal. "The SEC's administrative
proceeding has no merit. Steve Cohen acted appropriately at all
times and will fight this charge vigorously," said SAC
spokesperson Jonathan Gasthalter of PR firm Sard Verbinnen
& Co. said in a statement. "The SEC ignores SAC's
exceptional supervisory structure, its extensive compliance
policies and procedures, and Steve Cohen's strong support for
SAC's compliance program."
SAC’s flagship global equity fund is up 8.25%
through midyear, almost twice the 4.67% median gain for the
Absolute Return Global Equity Index. The firm managed
$15.04 billion on January 1.
The full SEC filing is below.
SEC Charges SAC's Steve Cohen by Absolute Return
ISSN: 2151-1845 / CDC10004H