Wed, Dec 13, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

SAC’s Cohen under probe by SEC, Senate

Thursday, May 26, 2011

Steve Cohen
Opalesque Industry Update: Two weeks after federal prosecutors succeeding in securing a guilty verdict against Galleon Group founder Raj Rajaratnam for insider trading, it has been reported that the Securities and Exchange Commission along with Congressional investigators, are looking into the trading record of SAC Capital, one of the largest hedge funds in the world based in Stamford, Conn., founded by Steve Cohen.

On Tuesday, Republican Sen. Chuck Grassley from Iowa, sent a letter to SEC chairwoman Mary Schapiro demanding an explanation of how the agency is dealing with alleged suspicious trading activities related to Cohen’s $13bn hedge fund.

Grassley wants to meet with SEC officials this Friday, in addition to requesting a written explanation of the agency’s probe into SAC’s alleged questionable activities. The senator gave SEC officials until June 7 to submit the written explanation, which specifically demands how the SEC “resolved: tips to some 20 trades conducted by SAC dating as far back as 2000.

Last week, a spokesman for Grassley confirmed that the senator would conduct an investigation into SAC’s suspicious trading “on about 20 instances.”

To begin his probe, Grassley has requested some key information from the Financial Industry Regulatory Authority (FINRA), an independent regulator of brokerage firms, on certain trades relating to SAC.

On Monday, SAC Capital issued a statement claiming they met with investigators and that they are cooperating with the probe.

“We welcomed the opportunity to meet with the staff to educate them about the firm and our compliance efforts, and had an entirely appropriate, professional and cordial meeting. We will continue to cooperate in any way we can,” the company said in the statement. Grassley wants to know if the SEC has issued a "Wells Notice" (a letter from a regulator informing a company that enforcement action has commenced), to SAC Capital concerning reports that company has received a high number of referrals compared to other companies.

The Senator wrote in his letter to Schapiro, “The function of Congressional investigations is not to establish whether any private firms have violated the law, but rather to examine particular facts and circumstances in order to assess how well the agencies created by Congress are executing the authorities granted to them. Looking into specific examples is essential for Congress to understand how effectively the S.E.C. pursues referrals such as these.”

The senator has been a constant critic of the SEC and is questioning the agency’s vigilance towards protecting investors. Grassley also criticized the SEC for failing to discover the massive Bernard Madoff Ponzi scheme despite signs.

Grassley now wants the investigation against SAC capital expanded .

A spokesperson from Grassley’s office refused to divulge more information on the expanded investigation. The spokesperson told Gamut News, “(We) can’t offer any specifics of the information received from Finra on SAC, at the request of the investigative agencies involved.”
- Precy Dumlao

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Mediobanca acquires majority stakes in Swiss hedge fund[more]

    Komfie Manalo, Opalesque Asia: Listed diversified banking group Mediobanca SpA said it has acquired a majority stake in Geneva-based hedge fund firm RAM Active Investments SA (RAM AI), an active and alternative asset manager offering a range of act

  2. Launches - Ex-BlueCrest team to open over $200m hedge fund, Greg Coffey, a hedge fund star who retired at 41, is eyeing a comeback, Brevan Howard plans Greek funds as bond rally signals revival[more]

    Ex-BlueCrest team to open over $200m hedge fund From Bloomberg.com: A team of traders who left BlueCrest Capital Management earlier this year raised more than $200 million for their own hedge fund focused on Asian stocks, according to a person familiar with the matter. Ovata Capital Manag

  3. North America - Miami could attract hedge funds if SALT deductions axed[more]

    From Law360.com: For years, inertia has been Nitin Motwani's greatest foe in his attempts to lure hedge fund owners in the northeast to Miami, which he has pitched as a tropical low-tax paradise. But with the Republican tax bill proposing to eliminate deductions for state and local taxes, he's sensi

  4. Northleaf Capital Partners closes debut private credit fund on $670M[more]

    Bailey McCann, Opalesque New York: Northleaf Capital Partners has closed its debut private credit fund - Northleaf Private Credit I - on $670 million. The vehicle will invest in private credit transactions in Europe and North America, with a primary focus on lending to private equity-backed compa

  5. Opalesque Exclusive: Credit Suisse Asset Management's NEXT Investors leads $6M Series A round for LUX Technology and Services[more]

    Bailey McCann, Opalesque New York: Credit Suisse Asset Management's NEXT Investors has led a $6 million Series A funding round for LUX Technology and Services, a business and technology solutions provider for the alternative assets industry. The investment will be used to fuel growth of Trans