FBI Arrests SAC Portfolio Manager
"Mr. Steinberg was at the center of an elite criminal club, where cheating and corruption were rewarded," he said. "Research was nothing more than well-timed tips from an extensive network of well-sourced analysts."
At least four other people associated with the Stamford, Conn.-based firm have been arrested over a period of about four years.
The arrest of Steinberg and the January arrest of a former hedge fund portfolio manager for an affiliate of Cohen's firm have increased speculation that the government is taking a hard look at the practices of the wealthy hedge fund owner.
In the January case, Cohen is repeatedly referenced in court papers as a "Hedge Fund Owner." He has not been charged, and SAC spokesman Jonathan Gasthalter has said the company and Cohen are cooperating with the inquiry and "are confident that they have acted appropriately."On Friday, Steinberg was charged with conspiracy to commit securities fraud and four counts of securities fraud, accused of using inside information as he made trades involving Dell Inc. (DELL) and Nvidia Corp. (NVDA) securities. If convicted, he could face up to 85 years in prison. Prosecutors said he made more than $1.4 million illegally in connection with trades involving Dell and Nvidia in 2008 and 2009. In a civil case filed Friday by the Securities and Exchange Commission, the agency said Steinberg's trades resulted in more than $6 million in illegal profits or avoided losses for the company. "Steinberg essentially got an advance copy of Dell and Nvidia's quarterly earnings announcements, allowing him to trade on tomorrow's news today," said George S. Canellos, acting director of the SEC's Division of Enforcement. The SEC said Steinberg used inside information to trade securities of Dell and Nvidia in advance of at least four quarterly earnings announcements by the companies. ___ Associated Press Writer Tom Hays contributed to this report.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV