Moscow. December 22. The Commission on securities and stock exchanges (SEC) the US softened approach on the participation of the hedge Fund SAC Capital Advisors and its founder Steven Cohen in the largest insider trading scheme in U.S. history, writes The Wall Street Journal. After a two year break, said the SEC charges against Cohen.
The Prosecutor’s office and U.S. regulators for several years to investigate the activities of Cohen and his company, forcing SAC to plead guilty in 2013. However, from all agencies, only the SEC has charged a financial magnate personally. It was about a lifetime ban on managing the assets of others, but now the priest, apparently, will be able to get a significantly less punishment.
The prosecution was forced to reconsider the position in October after the U.S. court of appeals ruled on another case involving SAC Capital, refusing to acknowledge the fact of insider trading. The decision of the appellate court forced the prosecution to abandon seven of the charges.
It is not yet clear how business will develop in the future. SEC lawyers and Cohen on Monday told a judge that he had negotiated a settlement of all issues.
“I think it’s fair to say that to date we have not reached the stage of an agreement in principle, but we negotiated,” he told reporters then SEC lawyer Matthew Solomon.
Cohen’s representatives refuse to comment.
Investigation of irregularities SAC has become one of the largest and most prolonged in the history of wall street – first suspicions of the regulators and the prosecution have any more than ten years ago. SAC was accused of encouraging traders to receive insider information since 1999 and ignoring signals about the illegality of this practice within the framework of a criminal investigation.
Estimated SEC, SAC, illegally earned more than $275 million on operations with insider information.
SAC is one of the largest and most successful hedge funds in the U.S., which showed an average yield above 25% a year for two decades and was one of the largest clients for the investment banks of wall street.
Steven Cohen founded SAC (an abbreviation of his name – Steven A. Cohen) in 1992, when he was 36 years old, investing in a hedge Fund just over $20 million of their own funds. For two decades, SAC became the authoritative incompany, generating about $1 billion in commissions for the trading operations, fundraising, and other payments that attracted to her banks and brokers.
As of July 2013 (before guilty plea), the company had approximately $15 billion of assets under management (of which more than half is money the Cohen) and about 1 thousand employees.
The priest with his fortune of $12 billion on 109-th place among the richest people in the world and 44th in USA, also known as the owner of a large collection of art, which contains paintings by van Gogh, Manet, Cezanne, Warhol. In 2013 in particular, he bought the painting by Pablo Picasso for $155 million in addition, Cohen is the most wealthy person among the managers of hedge funds, according to Forbes.
Militiamen “circling” around a hedge Fund, which mysteriously managed to achieve such a high profitability of transactions for 10 years. In the end, there were revealed several cases of fraud and insiderscore trade, eight staff members were charged, six have pleaded guilty and went on cooperation with the investigation.
In November 2013, hedge Fund SAC Capital pleaded guilty to securities fraud in the case of operations with insider information and has agreed to pay a record fine of $1.8 billion, and the new York public Prosecutor announced that SAC will cease operations in the sphere of investment consulting.
In the framework of criminal investigation SAC had to transfer to the U.S. Treasury $1.2 billion are added To this amount agreed in March 2013 to $616 million (an unprecedented penalty) for failure by the SEC of charges to Fund the civil violations.
In September 2014, a former SAC traders Matthew Martoma was sentenced to nine years in prison for participating in insider trading.