Chicago-based independent futures brokerage and clearing firm R.J. O’Brien & Associates (RJO) has hired industry veteran Daniel Staniford as Executive Director, responsible for the firm’s institutional business development in New York and London.
Saturday, 3 December 2016
Last updated 14 hours ago
Oct 29 2013 | 7:04pm ET
SAC Capital Advisors has agreed to plead guilty to insider-trading charges and pay the largest-ever fine associated with the crime as part of a deal to settle criminal charges.
The deal could be formally announced by the end of this week, at which time SAC representatives would appear in court to enter guilty pleas to securities fraud charges, The Wall Street Journal reports. SAC will pay about $1.2 billion and will agree to cease managing outside capital, although it will be permitted to remain in existence as a family office.
The fine will come on top of $616 million SAC agreed to pay to settle Securities and Exchange Commission charges in March. The hedge fund had argued that figure should be counted against the criminal fine, and in one sense it has: Prosecutors had sought $1.8 billion from SAC in earlier negotiations.
The settlement agreement, which will also cover a civil forfeiture action brought be prosecutors that sought to seize all of SAC's assets, remains to be finalized, with several details still being ironed out. It is also possible, though unlikely, that the deal will fall apart.
SAC is still in talks with the SEC, which has brought a civil case against founder Steven Cohen for failure to supervise his employees, seeking to have him barred for life from managing outside capital. The deal with prosecutors does not cover Cohen, who has not been criminally charged, although the government's investigation into his own activities will continue even after the settlement. An agreement with the SEC could still be announced simultaneously with the criminal settlement.
Whenever the deal is announced, representatives of SAC and three of its entities will enter pleas. They will also have to allocute, describing the firm's crimes in open court, and are expected to refer to at least some of the six former SAC employees who have pleaded guilty to insider-trading. But SAC will not have to admit wrongdoing in the only case that prosecutors have been able to directly link Cohen to, that of Mathew Martoma, the former SAC portfolio manager set to stand trial next year. SAC will also not have to admit wrongdoing in the case of Michael Steinberg, the on-leave SAC trader whose trial begins next month.
SAC will then have to wind-down as a money manager—the firm's clients have already moved to redeem substantially all of its outside capital—and surrender its investment-adviser registration with the SEC. Prosecutors are leaving it to the regulator to decide how long Cohen himself will be barred from managing outside capital.
SAC's lawyers have spent the past several weeks pushing for the firm to be allowed to plead guilty to a lesser charge. But prosecutors were adamant that the firm, which Manhattan U.S. Attorney Preet Bharara has called "a magnet for market cheaters," plead guilty to securities fraud.