SAC's Cohen seen avoiding criminal charges by July deadline: WSJ
BOSTON (Reuters) - U.S. prosecutors do not have enough evidence to file criminal insider trading charges against hedge fund manager Steven A. Cohen before a July deadline, the Wall Street Journal reported on Thursday.
Citing unidentified sources familiar with the government's investigation into the $15 billion hedge fund and its founder, the Journal said this month's deadline, tied to a five-year statute of limitations on filing criminal charges, would likely pass without any action.
A SAC spokesman declined to comment.
Cohen and his SAC Capital Advisors, which delivered 30 percent returns on an annualized basis since 1992, have been at the center of the government's long-running probe into how hedge funds use illegally obtained information to boost performance.
Prosecutors last year charged Mathew Martoma, a former SAC employee, with having earned millions for the firm, thanks to well-timed trades in drug companies Elan Corp ELN.I and Wyeth Inc, now part of Pfizer Inc (PFE.N: Quote), in 2008 after he allegedly received non-public negative information about drug trial results. Martoma pleaded not guilty and his trial is set to begin in November.
Since launching its investigation into SAC, the government has charged or implicated nine former or current SAC employees in insider trading cases. Neither the firm nor Cohen have been charged with any wrongdoing.
In March SAC agreed to pay a $601.7 million fine to the U.S. Securities and Exchange Commission to settle allegations arising from the Elan and Wyeth trades.
The Journal also reported that the SEC's ongoing investigation of Cohen could lead to civil charges against him, citing an unnamed source close to that investigation.
While the conventional wisdom on Wall Street has been that the clock is running out on prosecutors making a case by the July deadline, continuing investigations into allegations of insider trading in at least two other stocks, first reported by Reuters in December, could extend the deadline to file charges for three more years, people familiar with the SAC probe told Reuters. Continued...