SAC Capital, the hedge fund founded by billionaire and philanthropist Steven Cohen of Greenwich is reportedly close to settling the federal fraud case brought earlier this year by the government.
According to CNBC, the plea deal would require SAC to plead guilty to criminal misconduct and pay more than a $1 billion fine for insider trading charges. SAC, which is based in Stamford, manages more than $13 billion in assets and is expected to complete details of the plea arrangement before the Nov. 18 trial of SAC manager Michael Steinberg, according to the reports.
A guilty plea probably will result in SAC being unable to manage public money and could mean the firm either will have to convert to a so-called family office, managing only Cohen's and his senior employees' money, or shut down, according to the reports.
Spokesmen for the U.S. Attorney's Office and SAC would not comment on the report.
Last week, employees in SAC's London office were notified that that outpost would be shuttered by the end of the year, according to Reuters. Those staff reductions are in addition to recent cuts in portfolio managers and marketing posts, as well as the closing of an office in Chicago, according to the report.
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