The SEC may hit SAC Capital with civil charges
When SAC Capital called a meeting with limited partners for today, most assumed that it would be to quell any fears that have built up over the Mathew Martoma indictment.
As it turns out there was a significant enforcement development to report. SAC Capital has received a Wells notice from the SEC, according to media reports. This doesn't mean that an indictment is coming (the company received a Wells notice several years ago, and no charges resulted), but it certainly makes concrete what everyone already knew, which is that the government is pondering charges seriously.
SAC also noted that Steven Cohen was deposed on this issue earlier in the year. It should be noted that SEC filed a parallel complaint against Martoma, when the criminal indictment was handed down. But that doesn't really clear up what the SEC is pondering. It might slap the firm with civil insider trading charges, or it might levy failure to supervise charges against the firm, as I suggested previously.
It's unclear if Cohen himself would be named as a defendant. As of right now, there's no way to tell if the SEC's activity indicates anything significant about the likelihood of criminal charges against the firm or the founder. More information will hopefully trickle out soon.
- here's the article
SAC Capital skating close to prosecution again