Goldman’s Gary Cohn Says SAC Capital ‘Great Counterparty’Michael J. Moore
Goldman Sachs Group Inc. President Gary Cohn said his firm continues to do business with SAC Capital Advisors LP, the hedge fund that was indicted on charges of insider trading last week.
“They’re an important client to us, they have been an important client to us,” Cohn, 52, said today in an interview on CNBC. “We continue to trade with them, and they’re a great counterparty.”
Goldman Sachs, which gets more than half its revenue from trading, is the first Wall Street firm to comment publicly on its dealings with the $14 billion hedge fund company founded by Steven A. Cohen. Bank of America Corp., JPMorgan Chase & Co. and Morgan Stanley were among firms that were continuing to trade with SAC Capital after the indictment, four people briefed on the matter said last week.
SAC Capital denied it encouraged or tolerated insider trading and said it will continue to operate as it works through the allegations. The U.S. Securities and Exchange Commission filed an administrative complaint against Cohen, seeking to ban him from overseeing investor funds for allegedly failing to supervise employees and prevent them from engaging in insider trading.
The hedge fund has been among the largest trading clients for New York-based Morgan Stanley and Goldman Sachs, according to people with knowledge of the relationships. SAC Capital, based in Stamford, Connecticut, has used those firms, along with JPMorgan, Credit Suisse Group AG and Barclays Plc, as prime brokers, Reuters reported in 2011.