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SEC: Steve Cohen is a horrible boss

July 19, 2013: 2:47 PM ET

Horrible_Bosses (1)SEC files civil case against hedge fund titan.

FORTUNE -- Apparently teflon sometimes can melt in the heat.

The Securities and Exchange Commission today filed civil charges against hedge fund titan Steve Cohen, alleging that he failed to "reasonably supervise" two employees at his SAC Capital. The pair -- Mathew Martoma and  Michael Steinberg -- both had been previously charged with insider trading.

"Hedge fund managers are responsible for exercising appropriate supervision over their employees to ensure that their firms comply with the securities laws," said Andrew Ceresney of the SEC's enforcement unit. "After learning about red flags indicating potential insider trading by his employees, Steven Cohen allegedly failed to follow up to prevent violations of the law."

SAC already had agreed to pay a record $615 million to settle insider trading charges, but the SEC's latest action would seek to bar Cohen from overseeing investor funds."

Greenwich, Conn.-based SAC is vowing to "fight this charge vigorously," adding that it has "no merit."

Read the full SEC complaint below:

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Dan Primack
Dan Primack
Senior Editor, Fortune

Dan Primack joined Fortune.com in September 2010 to cover deals and dealmakers, from Wall Street to Sand Hill Road. Previously, Dan was an editor-at-large with Thomson Reuters, where he launched both peHUB.com and the peHUB Wire email service. In a past journalistic life, Dan ran a community paper in Roxbury, Massachusetts. He currently lives just outside of Boston.

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