Insider trading charge for SAC fund manager

Prosecutors in the US have charged Michael Steinberg, a veteran portfolio manager with Steven A Cohen’s $15 billion (£10bn) hedge fund, with engaging in insider trading in two technology stocks.

The five-count indictment was announced soon after FBI agents arrested Steinberg at his home in New York City yesterday morning.

Federal prosecutors accused Steinberg of using inside information to trade in the shares of computer firm Dell and chipmaker Nvidia, generating illegal profits for Cohen’s hedge fund group, SAC Capital Advisors.

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Barry Berke, Steinberg’s lawyer, said in a statement that his client had done “absolutely nothing wrong” and his “trading decisions were based on detailed analysis”.

SAC Capital spokesman Jonathan Gasthalter said: “Mike has conducted himself professionally and ethically during his long tenure at the firm. We believe him to be a man of integrity.”

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In a related civil complaint against Steinberg, the US Securities and Exchange Commission (SEC) said the information allowed Steinberg to generate $6.4 million in profits and avoid losses for Cohen’s hedge fund.

Steinberg is one of nine current or former employees of SAC Capital who have been charged or implicated with insider trading.

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His arrest comes two weeks after SAC agreed to pay a record $616m to the SEC to settle civil charges of insider trading. Last year former SAC analyst Jon Horvath pleaded guilty to using illegally obtained information to trade in Dell.