A civil forfeiture lawsuit against SAC Capital Advisors LP should be put on hold while prosecutors continue their criminal case against the hedge fund over alleged insider trading, the U.S. told a federal judge in Manhattan.
“Civil discovery would adversely affect the ability of the government to conduct the prosecution of a related criminal case,” prosecutors said in the filing today.
The hedge fund, which held as much as $14 billion in July, was founded by Steven A. Cohen, who is worth about $9 billion, according to the Bloomberg Billionaires Index.
Prosecutors announced criminal charges against the fund on July 25 over what they described as unprecedented insider trading by employees as far back as 1999. That day, the government also filed the civil suit alleging SAC engaged in money laundering of illicit profits from the scheme by comingling them with the firm’s capital. In that case, the government is seeking the forfeiture of “all property, real and personal” derived from insider trading offenses.
Jonathan Gasthalter, a spokesman for SAC at Sard Verbinnen & Co., didn’t immediately respond to an e-mail seeking comment on the government’s filing.
The civil case is U.S. v. SAC Capital Advisors LP, 1:13- cv-5182, U.S. District Court, Southern District of New York (Manhattan).