Tuesday, 23 September 2014
Last updated 8 min ago
Feb 18 2011 | 11:04am ET
Steven A. Cohen’s hedge fund, SAC Capital Advisors, reported almost tripling its stake in Hilton Hotels three days before Blackstone group announced its 2007 buyout of the company, according to Bloomberg.
The news agency asked New York Law School associate professor Houman Shadab to review SAC’s holdings in stocks that have been identified by prosecutors as subjects of insider leaks.
The results show the Hilton trade was one of at least 11 occasions on which SAC traded stocks near the time of what prosecutors are calling insider trading in the same shares by other funds.
“While the trades by themselves don’t prove insider trading or fraud, they are consistent with patterns federal investigators are examining based on trading of nonpublic information,” Shadab told Bloomberg.
Prosecutors subpoenaed SAC in November, but have not accused the company or any current employees of wrongdoing.
In the case of the Hilton shares, the stock soared 26% on the trading day following the July Blackstone announcement. SAC reported liquidating 99% of its stake by that September 30. Federal prosecutors allege Galleon Group co-founder Raj Rajaratnam's acquisition of Hilton shares on the day the Blackstone deal became public was based on an illegal insider tip.
SAC's Hilton buy was disclosed in a Securities and Exchange Commission filing.
Two former SAC portfolio managers, Noah Freeman and Donald Longueuil, are among the four hedge fund employees charged with insider trading in the Justice Department's massive investigation.
SAC released a statement on February 8 saying it was “outraged” by the alleged “egregious violations of our ethical standards” by Freeman and Longueuil. The two left SAC in 2010 “due to poor performance.” The government alleges their illegal conduct took place between 2006 and 2010.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitich, CIO of Petty Endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.