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Insider Crackdown Uses SAC Manager in Health-Care Pivot

Steven A. Cohen’s SAC Capital Advisors LP is at the center of the biggest insider case ever, part of a sweeping U.S. crackdown on illicit hedge-fund trading that focuses on the burgeoning exploitation of secret data on volatile health care stocks.

In doing so, the prosecution of a former Cohen lieutenant has brought the five year probe beyond the realm of technology stocks and into the busy underworld of health-care industry securities fraud. The charges against former SAC portfolio manager Mathew Martoma also place U.S. prosecutors closer than ever to Cohen, the hedge fund’s billionaire owner and founder, in the broadest insider trading investigation in a generation.