Art World Golden Boy Steven Cohen To Face New Civil Charges

by Paddy Johnson on July 22, 2013 · 0 comments Newswire

Steven A. Cohen's house complete with a Jeff Koons Balloon Dog (Yellow)

Looks like billionaire hedge funder and art collector Steven Cohen may have to sit out a few more art fairs. Failing to land any of the insider trading charges that kept Cohen away from Art Basel this December, the Securities and Exchange Commission is now charging him with failure to supervise SAC Capital managers.  SAC Capital Advisors portfolio manager Mathew Martoma and SAC executive Michael Steinberg are both facing criminal and civil insider trading charges. They should have been supervised.

Last Friday, enforcement lawyers presented SEC commissioners with the memo urging them to vote to charge Cohen. Only Republican commissioner, Daniel Gallagher, failed to cast a vote as he was traveling. All other commissioners voted in favor of filing the charges.

This spring, he settling $616 million in insider trading lawsuits, and then bought a $155 million Picasso immediately afterward. Cohen, a well-known blue chip collector, made waves this December when he remained absent from the Miami art fairs. Timothy Blum, co-owner of Blum & Poe, told the New York Times last year that he was responsible for a large percentage of their sales, and David Zwirner expressed deep concern for his friend. “The art world is rooting for you,” he told The New York Times.

Don’t count us in on that group. When traders dump hundreds of thousands of dollars worth of shares on the market because they have information unavailable to the public, it’s a bunch of little guys that get stuck holding the bag. If Cohen is guilty of failing to supervise his managers, he should be appropriately charged.

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