July 19, 2013 / 10:15 PM / 6 years ago

Timeline: SAC and the long, winding insider trading probe

NEW YORK (Reuters) - The U.S. Securities and Exchange Commission on Friday charged hedge fund mogul Steven A. Cohen with failing to supervise a former SAC Capital Advisors portfolio manager and another SAC executive, both of whom are facing criminal and civil insider trading charges.

The SEC charges are part of a long-running probe of Cohen and his $15 billion hedge fund by regulators and federal investigators in which nine one-time SAC employees have been charged or implicated with insider trading.

Here is a timeline of major events in the investigation:

2009 - Raj Rajaratnam, founder of hedge fund the Galleon Group, is arrested in October and charged with securities fraud and conspiracy.

2009 - Richard Choo-Beng Lee, a co-founder of hedge fund Spherix Capital and former SAC Capital employee arrested as part of the Galleon probe, begins cooperating with the government. He provides authorities with evidence of alleged insider trading he may have engaged in while at SAC Capital.

2011- U.S. prosecutors charge three hedge fund portfolio managers and a hedge fund analyst with insider trading, including former SAC portfolio managers Noah Freeman and Donald Longueuil. Freeman pleads guilty in February 2011 and Longueuil pleads guilty in April 2011.

2011 - Former SAC analyst Jonathan Hollander reaches a civil settlement in April 2011 with the SEC over allegations he engaged in insider trading in his personal account while working at SAC.

2012 - Technology analyst Jon Horvath, who was supervised by Michael Steinberg at SAC, is charged with using inside information on Dell Inc to help SAC earn a $1 million profit. Horvath pleads guilty in September 2012.

2012 - In December a grand jury indicts Mathew Martoma, a former portfolio manager at CR Intrinsic Investors, one of SAC’s funds, in what prosecutors call the “most lucrative” insider trading scheme ever. The case is the first to make reference to Cohen, calling him the owner of the fund. Martoma pleads not guilty.

2013 - In March U.S. prosecutors charge Michael Steinberg, a top executive at SAC, with insider trading in shares of computer maker Dell Inc and chipmaker Nvidia Corp that generated about $1.4 million in illegal profits. He is the most senior SAC employee to be indicted in the probe. He pleads not guilty.

2013 - In March SAC affiliate CR Intrinsic agrees to pay more than $600 million to settle charges relating to the Martoma investigation. It is the largest settlement of its kind. Sigma Capital Management, also an SAC unit, agrees to pay nearly $14 million to settle a separate insider trading case.

2013 - In April lawyers for SAC call a meeting with U.S. prosecutors and FBI agents to argue that there should be no insider trading charges filed against Cohen or his hedge fund. Cohen’s lawyers make a detailed presentation as to why authorities did not have enough evidence to charge Cohen with either insider trading or any other securities law violation.

2013 - In May, Cohen and four other SAC executives receive subpoenas to testify before a federal grand jury about allegations of insider trading. Cohen declines to testify, citing his Fifth Amendment right against self-incrimination.

2013 - In June, SAC investors ask to withdraw about $3 billion from Cohen’s fund as the insider trading probe heats up.

2013 - In July the SEC charges Cohen with failing to supervise Mathew Martoma and Michael Steinberg, seeking to bar Cohen from the financial industry and managing other people’s money. SAC says Cohen will fight the charges “vigorously.”

Reporting by Katya Wachtel; editing Matthew Goldstein; Editing by Dan Grebler

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