September 16, 2014
CFTC Revokes Registrations of S.A.C. Capital Advisors, L.P. and S.A.C. Capital Advisors, LLC Based on Criminal Action
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that it filed a Notice of Intent to Revoke the Registrations (Notice) of S.A.C. Capital Advisors, LLC (SAC LLC), a Delaware Limited Liability Company, and S.A.C. Capital Advisors, L.P. (SAC LP), a Delaware Limited Partnership. The CFTC simultaneously issued an Opinion and Order (Order) accepting the offer of settlement from SAC LLC and SAC LP and settling the action. The Order immediately revoked SAC LLC’s registrations with the CFTC as a Commodity Trading Advisor (CTA) and Commodity Pool Operator (CPA). The Order also revoked effective December 31, 2015, SAC LP’s registrations as a CTA and CPO. Consistent with a previously issued Order of the Securities and Exchange Commission, SAC LP’s activities as a CTA and CPO are immediately restricted under the Order to certain “side pocket” investments that are not available for immediate redemption. Additionally, pursuant to the Order, an affiliate of SAC LP and SAC LLC, S.A.C. Capital Management, LLC, will immediately cease engaging in any activity requiring registration as a CPO or CTA.
The Notice alleged that, pursuant to the Commodity Exchange Act (CEA), SAC LLC and SAC LP were subject to a statutory disqualification of their registrations based on their convictions upon guilty pleas to the felonies of wire fraud, in violation of 18 U.S.C. § 1343, and securities fraud, in violation of 15 U.S.C. §§ 78j(b) and 78ff, in the criminal action, United States of America v. S.A.C. Capital Advisors, L.P., et al., 13 CRIM 541 (S.D.N.Y.). The criminal charges against SAC LP and SAC LLC in that action alleged, among other things, that multiple employees and agents of those entities, over the course of several years, obtained material, nonpublic information relating to publicly-traded companies and executed, or caused the funds managed by those entities to execute, securities trades based on that information. In their guilty pleas, SAC LP and SAC LLC admitted that at least one of their respective employees engaged in insider trading within the scope of their employment and for the benefit of the respective employer.
The CFTC’s Order finds that SAC LP and SAC LLC are subject to statutory disqualification from registration with the CFTC pursuant to Section 8a(2)(D) of the CEA and revokes their registrations under the terms set forth in the Order.
CFTC Division of Enforcement staff members responsible for this matter include K. Brent Tomer, David Acevedo, Lenel Hickson, and Manal M. Sultan.
Last Updated: September 16, 2014