On March 22, 2013, we posted a blog entitled S.A.C. Affiliate Settles Largest Insider Trading Case with $600 million Settlement, that detailed how SAC agreed to pay more than $600 million to settle SEC charges that it participated in an insider trading scheme. However, this was not the end of SAC’s problems.
On March 29, 2013, SAC Capital Advisors portfolio manager, Michael Steinberg, was arrested by the FBI on insider-trading charges. Mr. Steinberg is one of SAC’s longest tenured employees.
This arrest is the latest in the legal activities surrounding the government’s investigation of SAC. Earlier this month, as we reported, SAC signed off on two settlements in which the firm agreed to pay federal securities regulators $616 million to resolve two insider trading cases against SAC.
On March 28, 2013, however, a federal judge refused to approve the settlement due to concerns over a provision that allowed SAC to settle without admitting that it did anything wrong.
Mr. Steinberg’s arrest also highlights that federal authorities are attempting to reach into the highest ranks of the $15 billion hedge fund. Since late 2009, six former SAC employees have been convicted of or pleaded guilty to insider-trading charges, four are cooperating with authorities.
Jason Doss is the owner of The Doss Firm, LLC, an Atlanta-based law firm devoted to representing consumers across the country in a variety of areas including investment disputes and consumer class action litigation. Mr. Doss earned his J.D. from Florida State University in 2002 and his B.A. from the University of Florida in 1997.