New York (Hedge Co.Net) -Steven A Cohen’s hedge fund SAC Capital Advisors has received court approval on a record criminal settlement for insider trading on Thursday, as a US judge accepted a guilty plea from the hedge fund firm.
CBS reports: “U.S. District Judge Laura Taylor Swain formally administered the sentence on Stamford, Conn.-based SAC Capital LP and three related entities based on pleas made by a lawyer for the companies last fall to wire fraud and securities fraud.”
“These crimes clearly were motivated by greed, and these breaches of the public trust require serious penalties,” Swain said. “The defendants’ crimes were striking in their magnitude and strikingly indicative of a lack of respect for the law.”
The SAC companies will pay a $1.8 billion, a $900 million fine in the criminal case and $900 million in the forfeiture action. Because the SAC companies have already agreed to pay $616 million to the SEC to resolve related civil insider trading charges, the additional payment required under this agreement will be approximately $1.2 billion. The SAC companies also agreed that they cannot claim any tax deduction or credit for money paid in resolving the criminal case.
Cohen’s hedge fund is also trying to put the past behind them with a name change.
“In the aftermath of our settlement with the government, Steve and senior management considered whether our path forward as a family office would be simpler if we operated with new legal entities and new names,” President Thomas Conheeney said in a memo to employees. The new name refers to the address of SAC’s headquarters at 72 Cummings Point Road in Stamford.
“The name emphasizes we point to a successful future that rests on the exacting analyses of the companies, sectors and verticals by Point72’s portfolio managers and analysts,” Conheeney said. “We have selected strong new names that reflect our heritage or signal something important about our businesses.”
Alex Akesson
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