SAC said to face U.S. prosecution

Pointing The Finger

U.S. prosecutors plan to charge SAC Capital Advisors, the hedge fund founded by Steven A. Cohen, as soon as this week as part of a wide-ranging probe of insider trading, according to a person familiar with the matter.

Bloomberg News reports that the U.S. attorney’s office in Manhattan doesn’t plan to charge Cohen at this stage, said the person, who asked not to be identified because the matter is confidential.

Charges against the $15bn Stamford, Connecticut-based hedge fund might spell its demise, a fate it may also face from an administrative proceeding filed last week by the U.S. Securities and Exchange Commission. The SEC claimed Cohen failed to supervise its employees adequately to prevent insider trading, and seeks to ban Cohen from the financial industry.

Prosecutors, unable to obtain enough evidence to charge Cohen, 57, decided their next best option to discourage crime and punish alleged wrongdoing was to charge his firm, which carries with it the prospect of shutting it down, a second person familiar with the matter said.

Hit the link below to access the complete Bloomberg article:

SAC Said to Face U.S. Prosecution in Insider-Trading Probe

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image: © Lisamarie Babik

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