Cohen Cheers Insider-Trading Decision

Dec 15 2014 | 10:22am ET

Neither SAC Capital Advisors founder Steven Cohen himself nor any of his employees, current or former, were directly covered by last week’s major insider-trading ruling. But the billionaire is feeling a large measure of vindication, all the same.

According to Fox Business Network, Cohen is “ebullient” over the U.S. Second Circuit Court of Appeals’ reversal of the insider-trading convictions of two hedge fund managers. The court found that those accused of the crime—among them a dozen SAC veterans—must be aware that their tipsters received a personal benefit for revealing confidential information.

Just hours after the ruling came down, Cohen addressed employees at the former SAC’s holiday party in New York—the firm is now a family office called Point72 Asset Management, following its own guilty-plea to insider-trading charges. Fox reports that Cohen told the assembled that “we received very good news” from the courts that would benefit Point72 in the future as well as traders accused of the crime.

One of the greatest beneficiaries of the ruling is expected to be Michael Steinberg, the highest-ranking SAC employee to be convicted in the insider-trading crackdown. Steinberg was found to have been a member of the same “corrupt circle” as the exonerated Anthony Chiasson and Todd Newman, and is widely expected to have his conviction overturned, as well.

Cohen himself has not been charged with criminal wrongdoing, but still believes the ruling will benefit him and his firm. He has remained a top target of prosecutors even after the guilty plea extracted from SAC last year, and has been sued by the Securities and Exchange Commission for failure to supervise his employees. The SEC wants Cohen banned from the securities industry, while Cohen hopes to restart his hedge fund one day.

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