The U.S. said that same day the two men had a 20-minute telephone call. A person familiar with the case said Cohen is the hedge fund owner referred to by the U.S.
In a separate scheme, Steinberg, 41, was indicted in March for insider trading in Dell Inc. and Nvidia Corp. in 2008 and 2009, based on illicit tips funneled to him by his analyst, Jon Horvath. Steinberg is accused of earning $1.4 million in illegal profits for SAC.
Securities Fraud
Steinberg, who pleaded not guilty to securities fraud and conspiracy, was the most senior SAC official to be charged by the U.S. He is scheduled to go to trial in federal court in New York on Nov. 18. Horvath has pleaded guilty and is cooperating with the U.S.
The SEC alleged in its administrative action last week that Cohen, who was at his vacation home on New York’s Long Island in late August 2008, reversed his trading position and sold $11 million worth of Dell shares within minutes after receiving a “highly suspicious” e-mail sent to him by Steinberg and Horvath. Cohen avoided losses of more than $1.7 million, the SEC alleged.
“I have a 2nd hand read from someone at the company,” Horvath wrote in the Aug. 26 e-mail, which provided details on gross margins, expenditures and revenue. “Please keep to yourself as obviously not well known.”
Federal prosecutors said Horvath’s message contained nonpublic revenue and gross margin information days before the Round Rock, Texas-based computer maker was set to announce quarterly earnings. Steinberg is charged with insider trading in Dell based on Horvath’s tip.
SEC Settlement
In March, SAC agreed to pay a record $616 million to settle an SEC complaint alleging insider trading by Martoma and Steinberg without admitting or denying wrongdoing.
SAC spokesman Jonathan Gasthalter said, in response to the regulator’s administrative action on July 19, that it “has no merit,” and that Cohen had acted appropriately.