SAC Criminal Probe May Expand On SEC Lawsuit Allegations


Jon Horvath, a former analyst at SAC Capital Advisors LP who pleaded guilty to passing illegal tips to one manager at the hedge fund, also funneled inside information to another supervisor, U.S. regulators said in a lawsuit that may help accelerate the massive criminal investigation of SAC and its founder, Steven A. Cohen.

Bloomberg reports that a complaint against SAC’s Sigma Capital Management unit, filed Friday by the Securities and Exchange Commission in Manhattan federal court, signals the FBI and prosecutors have probably added another target to their criminal probe of SAC fund managers suspected of insider trading at the $15bn fund.

The Justice Department and the SEC previously identified only one SAC fund manager that they said received and traded on illicit tips from Horvath. Since the government’s five-year crackdown on insider trading began, at least six current or former SAC employees have been tied to allegations of insider trading. Four have pleaded guilty to federal charges.

SAC yesterday agreed to pay a record $616m to settle SEC allegations that Sigma and another affiliate, CR Intrinsic Investors, made illegal trades using nonpublic information. SAC and the affiliates didn’t admit or deny wrongdoing in the accord. Cohen hasn’t been sued personally by the SEC or charged with a crime.

Hit the link below to access the complete Bloomberg article:

SAC Criminal Probe May Expand on SEC Lawsuit Allegations

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