Fri November 8, 2013
Hedge Fund SAC Will Pay More Than $1 Billion For Insider Trading
Originally published on Fri November 8, 2013 4:54 pm
SAC Capital Advisors has pleaded guilty to wire and securities fraud, agreeing to pay at least $1.2 billion, the largest-ever penalty for insider trading.
The Stamford, Conn.-based hedge fund entered the plea four days after the government announced it had reached a deal with the firm, which is owned by billionaire investor Steven A. Cohen.
In July, the firm, one of Wall Street's largest hedge funds, had initially entered a not guilty plea, even though it had agreed in March to pay more than $600 million in penalties related to charges that it participated in an insider trading scheme involving a clinical trial for a new Alzheimer's drug.
"U.S. District Judge Laura Taylor Swain said she would refrain from deciding about whether to accept the plea until after she read the pre-sentencing report. She scheduled the sentencing hearing for March 14.
As part of the plea, [SAC General Counsel Peter] Nussbaum listed former employees who had been convicted of insider trading charges and described their offenses.
'On behalf of SAC, I want to express our deep remorse for the misconduct of each individual who broke the law while employed at SAC,' he said.
'This happened on our watch, and we are responsible for that misconduct.'"
The AP says the deal "allows prosecutors to continue [their] criminal investigation. It spares no individuals from scrutiny, including" Cohen.
"Cohen was accused by federal regulators over the summer in a civil action of failing to prevent insider trading at the company. He has disputed the allegations."