Jan 11 SAC Capital Advisors expects client
withdrawals of at least $1 billion in 2013 as the hedge fund
battles intense regulatory scrutiny over insider trading
allegations, the Wall Street Journal said on Friday, citing
people briefed on the matter.
The amount would be nearly a fifth of the $6.3-billion SAC
manages for outside investors. The rest of the $14-billion fund
is owned by founder Steven A. Cohen and associates including
other employees. ()
The company's executives have been alerting advisors and
senior employees recently about the withdrawal requests, better
known as "redemptions" in the hedge fund industry. The move
could deal a serious blow to company, the Journal said.
Earlier this week money manager Titan Advisors, one of SAC's
oldest outside investors, decided to pull its money from the
company, said to be between $75 million ad $100 million.
The Journal also quoted the people as saying that SAC's top
ranks have been contacting investors to gauge whether they want
to keep their money with the firm or not.
In November SAC informed investors in a conference call that
the U.S. Securities and Exchange Commission had warned it was
considering filing charges against the hedge fund over insider
The move by the SEC was made a week after prosecutors and
regulators charged one of SAC's former employee, Mathew Martoma,
with running one of the most lucrative insider trading schemes
ever. The authorities did not charge Cohen with wrongdoing but
they contend he signed off on the trades.
Martoma was the seventh former employee of Cohen to be
charged or implicated in the insider trading allegations, and
the criminal complaint against him is the first to refer to