Lawyers for hedge fund SAC Capital Advisors last week reached out to prosecutors in New York to say that SAC founder Steven Cohen is interested in settling the civil and criminal cases against him and his company, Bloomberg News reported yesterday. The settlement of the criminal case against the firm would likely involve a substantial fine and the current number being discussed is in the neighborhood of $1 billion. One of the factors being considered in determining financial penalties is the desire to inflict monetary pain on Cohen personally without damaging other parties. After a multiyear investigation conducted by the U.S. Attorney’s Office, the FBI, and the Securities and Exchange Commission, a grand jury indicted SAC Capital on July 25, accusing the firm of fostering a culture where employees engaged in rampant securities fraud. The indictment said traders at SAC engaged in insider trading that was “substantial, pervasive, and on a scale without known precedent in the hedge fund industry.”
