Monday, 4 May 2015
Last updated 2 days ago
Feb 14 2013 | 2:19pm ET
Prosecutors appear poised to seek an indictment against a top SAC Capital Advisors portfolio manager, buoyed by an allegation from a former SAC analyst that he was pressured to garner insider information.
The U.S. Attorney's Office in Manhattan is preparing a grand-jury presentation against Michael Steinberg. Steinberg, who specializes in technology stocks at SAC's Sigma Capital Management unit, would be the most senior person at the hedge fund charged if the grand jury returns an indictment.
Charges could be sought within the next several months. But Steinberg is not the biggest fish that authorities are seeking.
According to The Wall Street Journal, Steinberg is seen as a potential cooperating witness against SAC founder Steven Cohen. Steinberg has been on leave from the hedge fund since October, shortly after he was identified as an unindicted co-conspirator in the case against Level Global Investors co-founder Anthony Chiasson and former Diamondback Capital Management trader Todd Newman.
Steinberg, who was close to the SAC founder, is known to have spoken with Cohen about a 2008 Dell Inc. trade at the center of that trial, which ended in Chiasson and Newman's conviction. Steinberg reported to his analyst, Jon Horvath, who has pleaded guilty and is cooperating with investigators, that Cohen wanted Horvath and another analyst to "compare notes… as we are on opposite sides of this one."
Horvath has told authorities that Steinberg pressured him to gather confidential information about technology companies. He has been meeting with investigators since his guilty plea in September, and spoke with them as recently as Jan. 23, according to the Journal.
Among the evidence that prosecutors could present to a grand jury is an e-mail from Horvath to Steinberg in August 2008, asking the senior man to "keep the DELL stuff especially on the down low," because an analyst friend had asked Horvath "to be extra sensitive with the info" about Dell's earnings announcement. In another e-mail exchange, Horvath said he had "a secondhand read from someone at the company" and asked Steinberg, "please keep to yourself as obviously not well known."
"Yes normally we would never divulge data like this, so please be discreet," Steinberg replied.
Steinberg has denied any wrongdoing. His lawyer said he had done "absolutely nothing wrong" and made "trading decisions based on detailed analysis."
SAC has said that it is confident that neither it nor Cohen had done anything wrong, and that they do not expect criminal charges against Cohen.
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…