Investor To Redeem $100M From Embattled SAC

May 29 2013 | 12:05pm ET

Another large investor is pulling its money from SAC Capital Advisors as the hedge fund braces for possible criminal insider-trading charges.

Ironwood Capital Management plans to redeem its $100 million investment in the hedge fund, joining the Blackstone Group, which plans to pull most—if not all—of the $550 million it invests in SAC. The San Francisco-based firm elected to quit the $15 billion hedge fund after SAC said earlier this month it was no longer cooperating unconditionally with the federal investigation into its practices.

SAC—which suffered $1.7 billion in redemptions in February—is bracing for another wave of withdrawal requests on June 3. The firm has sought to ease redemption terms, allowing investors who do not pull their money next month to still fully redeem by the end of the year, but has faced a wave of bad publicity in recent weeks, most notably word that federal prosecutors are mulling criminal charges and that six SAC executives, including founder Steven Cohen, have been subpoenaed to appear before a grand jury.

Cohen is also said to be planning to transform SAC into a family office managing only his own fortune as part of an offer to prosecutors to avoid charges.

SAC believed it had settled its most serious legal issues in March when it agreed to pay $616 million to end two Securities and Exchange Commission probes. But the firm, which has denied any wrongdoing, was disabused of that notion about a month ago at a meeting between the hedge fund's lawyers and prosecutors.

The government faces a July deadline to file criminal fraud charges against SAC or Cohen. But prosecutors are considering racketeering charges against the hedge fund, which would give them another five years to bring claims.


In Depth

Fitch Says Alternative Asset Managers 'Stable' Despite Dry Powder

Nov 20 2014 | 9:30am ET

Ratings agency Fitch says the outlook for seven publicly traded alternative asset...

Lifestyle

Cohen Buys $101 Million Sculpture

Nov 12 2014 | 9:17am ET

Steven Cohen was the sole bidder for a rare Alberto Giacometti sculpture at Sotheby...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.