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FBN’s Charlie Gasparino on lawyers’ concerns about the investigation into SAC Capital.
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As first reported by Fox Business Steve Cohen's SAC capital bracing for a massive redemptions amid a wide ranging investigation into possible insider trading violations.
At the -- hedge fund even though the fund is up this year.
Charlie -- how long does up this year last year I mean what he's doing very well amid a -- a lot of pressure we should point out that.
-- what I love about.
We have Fox Business you know it's it sometimes is like David vs a life right where the upstart.
We write this story on -- -- You're traveling through one of your affairs stories that that.
SEC capital was meeting -- hedge fund managers greasing.
For massive redemptions meaning people say how much money out I don't wanna -- red -- Wall Street Journal the basic copy of our lead here.
Five they -- that came out today.
I'll with the journal missed I think even though that you know in addition to becoming being very -- on this story -- the journal mrs.
why is this happening.
It's not necessarily that people want -- Steve Collins because they don't.
I can tell -- a financial budget for the good guys to control money.
I can fund the -- -- those hate those funds that invest in individual hedge funds I know a lot of people like that.
They've mostly call -- of the fact that he's up this year the advisors the money guys wanna keep their money with SEC capital.
It's the lawyers that are winning this battle the lawyers for all these guys for these advisors Hussein.
You gotta protect the clients there's a legal liability isn't -- here we cannot be associated -- -- fund possibly that is in this type of trouble.
And -- -- -- I you know the there's there's no charges right now against SEC get both Burkle and you know individual managers have been -- been charged and former former former former individual with him and all -- them before we should point out.
One there's one guy there that's on leave one of the top -- is is an unindicted named as an unindicted co conspirator one in the case.
So nothing is really concrete.
Has attacked attached itself to the funding to the -- that are -- just yet.
There is a wells notice by the securities exchange commission which could that means -- could be civil charges against SEC capital for possible inside of trade advise violations or.
Failure to manage its people well enough to prevent those violations.
But here's the thing that wells notice I believe and even -- -- civil.
And you don't go to jail that could doom -- the company because if there is.
Of that I've said this before -- you lives if there's a ten B five -- the highest civil violation.
You can't really manage money half of the money isn't that are outside investors you have to Steve -- seven billion dollar fortune.
You can't be registered hedge fund if you have a ten B five -- I don't believe -- it's.
-- he'd be basis tell everybody that that it's it's a black mark against you.
At a very high level I can they completely shut him down I don't know but I tape one of the things -- -- know about Goldman Sachs when they were.
They got involved that abacus investigation of selling the allegedly -- easy metal -- million.
Okay dating care so much that the money it was eighty wanted to charged with fraud ten B five fraud.
Why is that it prevents pension funds from given -- money for -- asset management division.
No pension fund to give money to a two to lay the entity that engages in civil fraud and that will be Steve college problem.
A fund the funds pension funds that outside money.
Would be barred probably -- -- money to somebody.
That he's been guilty of -- what are redemptions looking like I know that mid February was in the journal the journal said a billion I will only -- massive obstacle whatever we you don't know.
He can convince people to stay.
It could be a lot greater -- and they're trying to convince people well to what we reported my initial tip was this okay.
I didn't report this morning but just to -- back from my initial tip I got this well I was having a couple glasses of wine in LA in LA where.
I don't know I was I was in I was in the I was in the wine country house in Los illegals great little town up there -- countries outside LA.
I think the initial thing that could be a initial those illegals cafe in -- -- 88 dare drink a lot.
The initial tip with Steve -- himself was going out.
And and make -- around telling people don't pull out you know teach basic given the sales -- I heard that was big database -- that was not the case that it was though they did confirm.
That's their managers had to make -- around stirred her to senior management in making the rounds trying to prevent people from -- so I would be hasn't -- put a number on it I just tell you.
A stick what I said Monday but the journal -- on -- -- And -- -- but but it's fair to say though that when -- -- run on something like a banker hedge fund and he gets scared it could be two -- campaign how -- two billion.
Billions -- when people start -- money out you know some just Tanya.
Stick with the reporting here don't go any -- else another part of a family what we beat him and you know I would just say massive.
And the reason why is not performance he's doing well this here -- if they worried about this -- You get a ten B five violation on the firm.
-- fight like hell and man that's part pension funds don't wanna deal with government entities generally don't want to deal with that.
Could you leave your her long publicly elected everybody's -- much better want to.
But you don't look like a criminal in in prison helped -- me a break criminals when you and I can see your scalp for would need to really short you -- -- tough I don't want to.
I'd like good -- I have actually 200%.
A lot of -- -- cellist goodbye thank you Charlie keep breaking the story close.
