U.S. prosecutors are seeking as much as $2 billion from hedge fund firm SAC Capital Advisors to settle its criminal insider trading case.
The Wall Street Journal reported that SAC lawyers argued for a lower settlement amount last week at a meeting at the U.S. attorney’s office in Manhattan, and also pushed that the separate $616 civil regulatory fine the firm agreed to pay earlier this year be deducted from the criminal sanction.
The article added that SAC lawyers are expected to present a counter-offer to prosecutors in the next few weeks. While the negotiations are still in the early stage, the government is insisting that Connecticut-based SAC plead guilty to the charges as part of the deal.
After a multi-year investigation by the U.S. Attorney’s office, the FBI, and the Securities and Exchange Commission, a grand jury charged SAC Capital in July with wire fraud and four counts of securities fraud for allegedly allowing insider trading to go unchecked from 1999 through at least 2010. The SEC also charged SAC founder Steve Cohen for failing to prevent insider trading at his firm.
Cohen has since denied the charges and maintains that he and his firm behaved appropriately.
SAC had about $14 billion in total assets under management as of July 1.