The SEC continues to make SAC and hedge fund founder and manager Steven A. Cohen the target of insider trading in connection with the ongoing probe into “expert-networks” that has resulted in a number of successful prosecutions by federal authorities.
In this latest probe into SAC, Business Insider is reporting that the investigation stems from trades of stock in the biotech firm MedImmune before its multi-million takeover by AstraZeneca in 2007. When the deal was announced in April 2007, the stock price surged 18%.
According to The Wall Street Journal report, “trading was heavy before the announcement, driving shares up more than 50% over six weeks,” and this was an indication that a deal on the merger may have been reached before a formal announcement was made.
Meanwhile the probe into SAC’s biotech investments “is separate from the investigation being spearheaded by Senator Grassley and one being conducted by federal prosecutors in New York over SAC founder’s Steven A. Cohen’s private trading account.” The inquiries of SAC are part of a larger crackdown insider trading that federal authorities have described as “illegal behavior permeating U.S. markets, investment firms, banks and corporations ranging from technology and law firms to consulting firms.”
The WSJ piece also mentions that SAC manages nearly $14 billion in assets, and “its rapid-fire trading strategies have made it a valued client for Wall Street banks.” As an aside the story also alludes to recent discussions between Mr. Cohen and the New York Mets regarding franchise owner Fred Wilpon’s sale of a minority stake in the team.
Kyle Colona is a contributing writer for CompliancEX and a NY based freelance writer.