NEW YORK (Reuters) – Lawyers for SAC Capital Advisors called a meeting with U.S. prosecutors and FBI agents in April to argue that there should be no insider trading charges filed against the $15 billion hedge fund or its founder, Steven A. Cohen, according to sources familiar with the matter.
Lawyers for the firm made an “aggressive presentation,” according to the sources, reviewing the government’s investigation in detail to support their claim that the government did not have enough evidence to charge Cohen.
NEW YORK, May 20 (Reuters) – The decision by U.S.
prosecutors to compel Steven A. Cohen to testify before a
federal grand jury about allegations of insider trading at his
$15 billion hedge fund is leaving many criminal defense lawyers
scratching their heads.
In the past week, federal authorities have issued grand jury
subpoenas seeking testimony from Cohen and others at SAC
Capital, The New York Times first reported. Two people familiar
with the matter confirmed to Reuters that subpoenas had been
issued and Cohen was among those served.
It’s generally been thought the main exit strategy for Wall Street-backed firms that are buying distressed homes to rent them out, is to convert to a REIT and file for an IPO. That attempt to cash-out on the single-family home trade has obvious benefits for the big institutional buyers but risks for retail investors as the math behind the buy-to-rent model becomes increasingly suspect.
But there’s another potential exit strategy for the institutional buyers beyond converting to a REIT or flipping homes earlier than anticipated and that’s becoming a home lender.
LAS VEGAS (Reuters) – Michael Marchillo, a plumber, has been trying and failing for months to buy a bigger home for his family here in Sin City. He was pre-qualified by a bank for a $130,000 mortgage, which a year ago would have landed a typical three-bedroom home in the area. No more. Now, the 36-year-old says, it’s hard to compete with “greedy investors” who come to the table flush with cash for quick deals.
Marchillo is on to something. The once-beleaguered Las Vegas housing market has been on fire since investment firms led by Blackstone Group LP, Colony Capital and American Homes 4 Rent began buying homes here some eight months ago, backed by $8 billion in investor cash to spend nationally.
By Matthew Goldstein
When you think of Cleveland, finance isn’t the first thing that comes to mind.
NEW YORK, April 16 (Reuters) – A controversial proposal to
get local government officials to condemn distressed mortgages
– in the same way they might condemn a dangerous property — is
slowly gaining traction in some California communities, several
months after it appeared the idea had been killed.
After months of contentious debate, officials in San
Bernardino County, in January killed the idea of seizing
troubled home loans in a process known as eminent domain. They
rejected the idea after fierce opposition from Wall Street trade
associations and investors in mortgage-backed securities.
BOSTON/NEW YORK (Reuters) – This year’s sell-off in gold has been harmful for dedicated gold-bugs like hedge fund manager John Paulson but it has also hit managers like David Einhorn who is better known for his stock picks than his love of the yellow metal.
During the first quarter, however, Einhorn’s Greenlight Capital Management demonstrated just how much he and his investors have riding on gold as he recently listed it as the fund’s third largest position, an investor in the fund said.
Sometimes it seems that insider trading cases are all about hedge funds. After all, the overwhelming majority of the federal government’s multi-year crackdown on insider trading has netted dozens of traders and analysts working in the $2.25 trillion hedge fund industry.
But this week’s escapades involving a former top audit partner at KPMG and his golfing buddy are reminder that the temptation to profit from inside information exists in many industries and professions.
By Matthew Goldstein
SAC Select may not have been one of SAC Capital Advisors’ best-known portfolios during its brief trading history. But the computer-driven trading program may have been one of the more controversial at Steven A. Cohen’s hedge fund.
Setup by a number of SAC Capital’s algo- savvy traders, including Neil Chriss, who left SAC in 2007 to found Hutchin Hill Capital, SAC Select was designed to piggyback on the trades on some of the hedge fund’s top portfolio managers. SAC Select, which at its peak in 2008 managed about $4.2 billion in hedge fund assets, was discontinued sometime in 2009 or early 2010. The strategy was intended as an added investment benefit for long-time SAC Capital clients.
(Reuters) – U.S. prosecutors on Friday charged Michael Steinberg, a veteran portfolio manager with Steven A. Cohen’s $15 billion hedge fund, with engaging in insider trading in two technology stocks, the most senior SAC Capital Advisors employee to be charged in the government’s long-running probe.
The five-count indictment was announced a few hours after Federal Bureau of Investigation agents arrived at Steinberg’s home in New York City at around 6 a.m. EDT (1000 GMT) and arrested him.