Hedge-fund group SAC Capital Advisors LP and federal prosecutors have agreed in principle on a penalty exceeding $1 billion in a potential criminal settlement that would be the largest ever for an insider-trading case, according to people familiar with the matter.
The payment by SAC, run by star manager Steven A. Cohen, is expected to be roughly $1.2 billion to $1.4 billion, according to these people.
The penalty means SAC would pay the U.S. government a total of nearly $2 billion, including a $616 million penalty the firm agreed to in a civil insider-trading settlement with the Securities and Exchange Commission in March.
The firm didn't admit or deny wrongdoing in the civil settlement, which is awaiting approval by a federal judge. The firm says Mr. Cohen, who hasn't been accused of criminal wrongdoing, has done nothing wrong. Any settlement wouldn't affect a continuing criminal investigation into Mr. Cohen's trading activities, the people said.
Spokespeople for the Manhattan U.S. attorney's office, the Federal Bureau of Investigation, the SEC and SAC declined to comment on the negotiations.
Many know that there is something very wrong in their country, but do not know just what it is in Wall Street, international banks and the lack of timely and ethical governance.
Bottom Line for SEC and SAC: $1-to-2 billion penalty payment with no wrongdoing. After all, it's only money and comes with a "get out-of-jail card," too.
Source: The Wall Street Journal, October 18, 2013
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