Has Steven A. Cohen Bought Off the U.S. Government?

Back in March, when the Securities and Exchange Commission agreed to settle a big insider-trading case involving SAC Capital Advisors, one of the biggest hedge funds in the country, I mischievously suggested that Steven A. Cohen, SAC’s mercurial and publicity-shy boss, was effectively buying off the U.S. government for six hundred and sixteen million dollars. (That was the size of the fine that the S.E.C. levied on SAC.) It turns out that I was wrong. Cohen is laying out a lot more than six hundred big ones to try to make the feds go away. To be exact, he’s paying them $1.8 billion.

Make no mistake, though: this could still be a sweet deal for Cohen, who set up shop twenty years ago with just twenty-five million dollars under management. Assisted by a battalion of high-priced lawyers, he has reached a “global resolution” with the Justice Department that allows him to keep the bulk of the vast fortune—some nine billion dollars, according to the New York Times—that he made running a firm at which insider trading was “substantial, pervasive and on a scale without known precedent in the hedge fund industry.” And, at least for now, Cohen won’t face any criminal charges or the prospect of any jail time.

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