SAC Gets Subpoena in Insider Inquiry

[Joanne98]

SAC Capital Advisors, the hedge fund giant run by billionaire investor Steven A. Cohen, received an “extraordinarily broad” subpoena from federal authorities, according to a letter sent to its investors Wednesday.

Two large mutual funds, Wellington Management Co. and Janus Capital Group, have also received subpoena requests seeking a wide range of information.

The news of the governments latest round of subpoena requests comes a day after agents from the Federal Bureau of Investigation raided three hedge funds as part of a widening probe into insider trading on Wall Street.

No one at the firms searched by federal agents on Monday or handed subpoenas has been accused of wrongdoing. Neither Mr. Cohen nor SAC has been accused of wrongdoing.

Two of the three funds searched by federal agents yesterday are controlled by former SAC traders who spun off to start their own funds during the middle of last decade.

In its letter to investors, SAC defended itself against any accusations that might stem from the inquiry it received Monday, but told investors they would likely remain muted on the subject publicly.

“Neither the subpoena nor any other information of which we are aware suggests that anyone at SAC has engaged in any wrongdoing,” said the letter. “As you will surely appreciate, we will be a bit constrained in future comments.”

A spokesman for SAC declined to comment.

Wellington Management Co. also received its subpoena on Monday, according a person familiar with the matter. The subpoena was wide-ranging and did not seem to target specific information, said the person, who was not authorized to speak publicly about the letter.

Janus Capital Group acknowledged the inquiry and “intends to cooperate fully,” the company said in a statement.

http://dealbook.nytimes.com/2010/11/23/sac-gets-subpoena-in-insider-inquiry/

[Joanne98]

1. Wellington, Janus, SAC Said to Get Document Requests in U.S. Trading Probe

SAC Capital Advisors LP and Wellington Management Co. received requests for documents from federal investigators looking into insider trading, according to two people familiar with the matter. Janus Capital Group Inc. also was asked for information.

Wellington said on an internal conference call yesterday that it’s conducting a review of records, and that it didn’t engage in illegal trading, according to one of the people, who asked not to be named because the Boston-based firm is private. Janus, based in Denver, said today it received a request for “general information and intends to cooperate fully with that inquiry.”

Federal officials, led by U.S. Attorney Preet Bharara in Manhattan, are investigating whether money managers may have profited from insider trading, or buying and selling based on material, nonpublic information. The offices of hedge funds Level Global Investors LP and Diamondback Capital Management LLC, run by former traders of Steven A. Cohen’s SAC, were searched yesterday by agents from the Federal Bureau of Investigation.

“This is going to go beyond hedge funds,” said Stewart Massey, chief investment officer at Massey, Quick & Co. in Morristown, New Jersey, which manages $2 billion on behalf of endowments, foundations and wealthy families. “This is going to involve traditional money managers also.”

http://www.bloomberg.com/news/2010-11-23/wellington-said-to-get-document-request-from-u-s-in-insider-trading-probe.html