Did SAC Capital Turn a Blind Eye to Insider Trading?
U.S. Attorney for the Southern District of New York Preet Bharara on Thursday announced that his office has indicted SAC Capital Advisors
on one count of wire fraud and four counts of securities fraud. Eight portfolio managers and research analysts have been charged with or convicted of insider trading. It’s important to point out that Steven Cohen — who owns the fund — was not individually charged.
“This Indictment charges the corporate entities responsible for the management of a major hedge fund with criminal responsibility for insider trading offenses committed by numerous employees and made possible by institutional practices that encouraged the widespread solicitation and use of illegal inside information,” the indictment reads. “Unlawful conduct by individual employees and an institutional indifference to that unlawful conduct resulted in insider trading that was substantial, pervasive and on a scale without known precedent in the hedge fund industry.”