Overstock.com CEO Patrick Byrne colorfully explained in his own words why he took out a full page ad in the Wall Street Journal mocking SAC Capital's Steve Cohen Saturday.

"Cohen's life work is being destroyed," he wrote in a note to Business Insider, "I feel good. Shooting SAC Capital dead and throwing all of its employees into the streets is simply civilization scraping some dog--- off its shoe.  I felt it was time I spent $100k on a derisive ad in order to say that."

A Federal Grand Jury indicted SAC Capital on charges of insider trading this week after years of investigation.

Meanwhile, since 2005 Byrne has been saying that powerful market actors have been working to destroy his company. In 2010 he identified them as Michael Milken and SAC's Steven Cohen.

Two years later, emails accidentally leaked by lawyers representing a number of Wall Street banks described how the banks were allegedly naked short-selling Overstock.com stock and advising their hedge fund clients on how to do the same.

SAC Capital, as you know, is one massive hedge fund client.

"Eight years ago I was roundly criticized by coming out publicly and saying, in brief: A network of dirty hedge funds were practicing all kinds of dicey practices, including insider trading and naked short selling (and being serial killers of firms in the process)," Byrne wrote. "The SEC was not doing its job protecting our markets because it is a captured regulator, and this combination was destabilizing the system."

He continued: "Also that the mastermind, the Napoleon of crime, so to speak, was someone I initially identified as the "Sith Lord" of all that was evil and wrong on Wall Street. In the months after, I gradually dropped broader and broader public hints that I was talking about Stevie Cohen. Of course, through all of this my claims were spun, ridiculed, and mocked."

If the documents leaked by bank lawyers are any indication, Overstock was not only being ridiculed by the media, but also by insiders at Wall Street banks. Naked short selling (or "failing" a stock) is the practice of shorting a stock that has never actually been borrowed. It's illegal, in part, because it creates fake supply of a stock, and in 2005 and 2006 Overstock.com claims naked short-selling created six times the actual supply of its stock in the market.

Someone might choose to naked short sell a stock when the stock is a negative rebate stock — too expensive to borrow. That's why it sounded so damning when the emails leaked from banks said things like this:

"We are NOT borrowing negatives... I have made that clear from the beginning. Why would we want to borrow them? We want to fail them,"said one Merrill exec.

Now that you're clear on that, this portion of Byrne's note will make more sense (emphasis ours):

"Cohen is directly responsible for corruption in our capital markets that has cost hundreds of thousands, maybe millions of people, their jobs," he said. "Now SAC has been indicted, and Cohen's life work is being destroyed, I feel good: Shooting SAC Capital dead and throwing all of its employees into the streets is simply civilization scraping some dogs--- off its shoe. I felt it was time I spent $100k on a derisive ad in order to say that."

"Besides," Byrne added, "if you're not going to kick a man when he's down, when are you going to kick him?"

So that explains that, then.

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Hedge fund billionaire Steven A. Cohen did not let the filing of criminal charges against his $14 billion SAC Capital Advisors get in the way of a party this weekend at his vacation estate in tony East Hampton, New York.

The Saturday night party at Cohen's 10-bedroom home on Further Lane took place two days after federal prosecutors in New York announced the filing of a five-count criminal indictment against SAC Capital that portrayed the 21-year-old Stamford, Conn.-based fund as a breeding ground for unlawful insider trading.

The lavish affair, which one source said included delivery of $2,000 worth of tuna from a local fish store to Cohen's home, was planned before the charges were filed.

A person familiar with the event said the party attended by a few dozen people was intended by the 57-year-old manager to show support for ovarian cancer research, though it was not a fundraiser.

On Friday, lawyers for SAC Capital entered a not guilty plea to the charges. Some in the hedge fund industry said a fierce determination to carry on business as usual was behind Cohen's decision to go ahead with the bash at his 9,000-square-foot home on a street famed for its waterfront mansions.

Cohen, whose estimated fortune is $9 billion, set up shop in 1992 with just $25 million and earned a reputation as of the greatest stock traders of his generation. He built a firm that has posted a 25 percent average annual return, one of the best performance track records in the $2.4 trillion hedge fund industry, despite charging investors some of the highest fees.

SAC Capital, after the indictment was announced, sent an email to employees and investors saying the firm would operate as normal. It stressed that prosecutors did not intend to take any action that would imperil the firm's ability to return some $4 billion in outside investor money by year's end.

RARE MOVE RAISES QUESTIONS

It's a rare move for federal prosecutors to indict a corporation, and it remains to be seen just how long Wall Street banks that lend money to SAC Capital and trade with it, will continue to do.

It also remained to be seen whether Cohen, who faces no criminal charges himself, can keep his hedge fund empire together as a fully functioning firm employing nearly 1,000 people, with offices in eight cities around the globe.

And it was unclear whether Cohen's more than 500 investment professionals, traders and analysts, will remain with the firm as the criminal proceeding unfolds. Investors have withdrawn most of the $6 billion in outside money the fund managed at the beginning of the year.

"I would be running for the hills and looking for a job now if I were an SAC employee" said Mark Jordan, a veteran wealth management recruiter. "Who in their right mind would put money in SAC again?"

A review of LinkedIn profiles for more than a dozen SAC Capital employees revealed that some have been connecting through the online networking site with Wall Street job recruiters.

Up until recently, headhunters had said they were not seeing a flood of resumes from SAC employees, even after U.S. securities regulators filed a civil administrative complaint against Cohen on July 19 for failing to supervise two employees charged by prosecutors with insider trading.

(Additional reporting by Jennifer Ablan and Katya Wachtel; Editing by Frank McGurty, Paritosh Bansal and David Gregorio)

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San Francisco-based technology sell-side analyst Sandeep Aggarwal was arrested yesterday by FBI agents in San Jose, California on insider trading charges, the FBI New York bureau Tweeted.

Today, the U.S. Attorney’s Office for the Southern District of New York announced criminal charges against Aggarwal. 

Aggarwal, 40, is charged with one count of conspiracy to commit securities fraud, and one count of conspiracy to commit wire fraud.

He has also been civilly charged by the Securities and Exchange Commission.

Aggarwal, who lives in India and recently returned to the U.S.,  is accused of tipping off former SAC portfolio manager Richard Lee about a pending deal between Microsoft and Yahoo!. 

From the U.S. Attorney's release: 

On the evening of July 9, 2009, AGGARWAL learned from a friend who was an employee of Microsoft that discussions about the Partnership had recommenced and that a transaction was likely within the next few weeks. The next day, AGGARWAL provided information about the Partnership to at least two different hedge funds, including to Richard Lee, then a portfolio manager at SAC Capital Advisors LP. On July 10, 2009, AGGARWAL told Lee, in substance, that he had heard from a source – whom AGGARWAL described as “a senior guy at Microsoft” – that (a) senior Yahoo executives had been meeting with senior Microsoft executives at Microsoft’s offices; (b) senior Microsoft executives were making requests for information that suggested to the sources that a deal was likely to be completed soon; (c) the success of Microsoft’s Bing search engine had caused Yahoo to move closer to Microsoft’s offer; and (d) it was likely that the deal could be announced within the next two weeks. Thereafter, Lee’s hedge fund purchased several hundred thousand shares of Yahoo stock, and Lee purchased 25,000 shares of Yahoo stock in his personal account.

Last week, U.S. prosecutors said in a federal indictment that Lee pleaded guilty to insider trading charges. U.S. prosecutors said that Lee received non-public information in July 2009 about confidential talks between Yahoo! and Microsoft. 

"As alleged, Sandeep Aggarwal leveraged his contacts in the technology industry to obtain an illegal edge in the form of inside information about a highly anticipated development, and then lied about his criminal conduct. With his arrest today, we continue our work to investigate and prosecute privileged professionals who think the laws requiring honesty and fair play do not apply to them," Manhattan U.S. Attorney Preet Bharara said in a release.

Aggarwal worked as an analyst at Collins Stewart when he was allegedly passing the non-public information along, FINRA records show. There were several articles about him from 2009 talking about a possible deal between Microsoft and Yahoo!. (See here, here and here). 

After Collins Stewart, he had been employed with Oppenheimer & Co. and Caris & Co., records show. Before that, he worked at Citigroup, Microsoft and Charles Schwab, according to FINRA. 

Last week, Steve Cohen's $14 billion SAC Capital was indicted by a federal grand jury on criminal charges of insider trading. The hedge fund behemoth was charged with four counts of securities fraud and one count of wire fraud. Defense lawyers for the fund pleaded not guilty. 

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Former tech analyst Sandeep Aggarwal was arrested and charged today for leaking non-public information to a former SAC Capital portfolio manager.

Aggarwal is accused of leaking confidential deal talk between Microsoft and Yahoo to former SAC Capital ("Hedge Fund A") portfolio manager Richard Lee back in July 2009.

The complaint alleges that on July 9, 2009, Aggarwal had a phone conversation with Lee about the pending deal.  According to the complaint, Aggarwal told Lee that he heard from a "senior guy at Microsoft" that it was possible a Microsoft/Yahoo deal may happen within the next couple of weeks.

The complaint then alleges that after the phone conversation Lee purchased several hundred thousand of shares of Yahoo for his SAC portfolio. It also says that he bought 25,000 shares for his personal trading account. 

Just last week, Lee pleaded guilty to insider trading charges, U.S. prosecutors said in a federal indictment against Stamford, Connecticut-based SAC Capital Advisors.

One interesting tid-bit in today's complaint against Aggarwal is that a second unnamed hedge fund "Hedge Fund B" called up Aggarwal's then-employer (Collins Stewart) to tell them that they suspected he had disseminated non-public information. 

Collins Stewart confronted Aggarwal about this and he lied to his employer, the complaint alleges.

From the complaint [.PDF] (emphasis ours) 

Based upon my review of documents provided by teh Firm, and an interview with a former employee at the Firm, I have learned the following: 

On or about July 10, 2009, Hedge Fund B contacted the Firm and informed the Firm that it suspected that SANDEEP AGGARWAL, the defendant, was disseminating inside information. 

Members of the Firm's senior management, and legal compliance departments, questioned AGGARWAL about his communications with clients and his belief that there was a greater likelihood of a transaction between yahoo and Microsoft. AGGARWAL stated, in substance, that his sources of information were industry participants, not current employees of Microsoft or Yahoo nor professionals who could be involved with a transaction. 

Following the interview, at approximately 1:46 p.m., AGGARWAL sent an e-mail to employees at the Firm, including the Firm's then-head of research, in which AGGARWAL stated "Please note that I have been making some comments on a likely MSFT/YHOO search deal/partnership since morning and suggesting a higher likelihood for MSFT/Yahoo search deal" and that "My comments about MSFT/YHOO are based on my own assessment... and I have not heard anything to this regard either from current MSFT/YHOO employees or any bankers/layers etc involved in MSFT/YHOO possible deal." 

Subsequent to the 1:46 p.m. email, the Firm's management question AGGARWAL again and he reiterated his statement that he had not received information from any current Microsoft or Yahoo employees. AGGARWAL identified his "best industry contact" (reference in his call with Hedge Fund B) as a former employee of Microsoft, who left the company more than two years earlier and AGGARWAL stated that he did not believe that his contact possessed material nonpublic information. 

After Collins Stewart, Aggarwal worked at Oppenheimer & Co. and Caris & Co., FINRA records show. Before that, he worked at Citigroup, Microsoft and Charles Schwab, according to FINRA.
 
After leaving Wall Street, he started running ShopClues.com, an online marketplace in India. In his bio, he refers to himself as "one of the most popular and prominent Internet analysts in the US."

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The Wall Street firms that do business with SAC Capital are right to be privately worried about possible legal contamination from the criminal indictment against the hedge fund.

Publicly, Wall Street is standing behind SAC Capital. It's "business as usual," according to reports. Gary Cohn of Goldman Sachs recently praised SAC as "a great counter party" in an interview with my colleague Kate Kelly.

But behind the scenes, Wall Street executives are worried, according to people familiar with the matter. All the biggest Wall Street firms have extensive ties to SAC Capital — ties that could put them in legal jeopardy, particularly under much larger exposure spelled out in the Dodd-Frank banking reform regulations..

It would be hard to over-estimate the significance of SAC Capital to Wall Street. The hedge fund employs what has been described as "significant leverage" in its trading strategies, borrowing money so that the firm is able to take trading positions that aggregate to much more than the roughly $15 billion of assets it has under management. The firm lists its regulatory assets as $50 billion in a recent regulatory filing, for example. Much of that leverage comes from loans from Wall Street banks.

Even that understates how much business SAC does through the top Wall Street firms. That $50 billion is a snapshot in time, not a cumulative count of all of the assets that SAC acquires and disposes of throughout the year. No one outside of SAC — and very few inside of SAC — knows the total volume of trading SAC is responsible for across all the markets it trades in, but it's a safe bet that the number is in the hundreds of billions.

That kind of volume makes handling SAC's trades very big business for its prime brokers. Over the years, SAC Capital has paid billions in fees to its prime brokers, people in the sector estimate. According to a recent regulatory filing, those on the receiving end of SAC's prime brokerage fees include all the big prime brokers — Bank of America's Merrill Lynch, Barclays, BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan Chase, Morgan Stanley and UBS. In short, there's SAC money flowing all over Wall Street.

At many of these firms, there are people whose entire careers are built around their relationship with the hedge fund. They work for SAC almost as much as they work for their nominal employers — and certainly their paychecks depend on robust SAC trading.

"These folks may be eating crumbs that fall from the table of SAC — but those crumbs are made of gold," one person at a prime broker used by SAC said (he does not work directly with SAC).

So the news that the Justice Department is not seeking to freeze SAC's assets is welcome on Wall Street. The fees also explain why Goldman's Gary Cohn uses the phrase "great counter-party" to describe a hedge fund under criminal indictment. If the Justice Department's investigation were to somehow put a halt to "business as usual," the big Wall Street firms would lose hundreds of millions of dollars in revenue.

But the loss of revenue may not be the worst of it. Wall Street may face an even greater — if less probable — danger if SAC were to be convicted of criminal charges. Some prime brokers and their employees could find themselves targeted by regulators for "aiding and abetting" the alleged securities law violations of SAC.

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Some investors in SAC Capital — Steve Cohen's beleaguered hedge fund facing insider trading indictments — want to pull their money now, fearing the government will freeze assets.

But Bloomberg is reporting the $14 billion fund told clients that final payments will be made at the end of the year as usual, despite some investor pleas to recoup all of their money before then.

SAC has tried to keep a "business as usual" mentality, despite the highly-publicized investigation.

But the numbers tell another story. SAC execs think all outside investor money could be gone from the firm by the beginning of 2014 (from Bloomberg):

SAC started the year with $15 billion of assets, about $6 billion of which belonged to outsiders. As insider-trading probe against the firm intensified, clients redeemed more than $3 billion in the first half of 2013, which is being returned over the course of this year. SAC’s executives have said they expect the firm to start 2014 with about $9 billion in assets and that virtually all outside investors will be gone by then, according to people familiar with the firm.

At least 11 former or current SAC employees have been tied up in the investigation, Bloomberg reports.

Read the full report at Bloomberg>

SEE ALSO: Indictment Of SAC Capital Doesn't Stop Steve Cohen From Throwing A Huge Party

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SAC Capital started the year with $15 billion in assets, $6 billion of which belonged to outside investors.

But a high profile insider trading probe has seen Steve Cohen's embattled fund lose $3 billion in the first half of the year from investors (the firm has resisted client pressure to return all the money before the end of the year).

Bloomberg reported that the firm expects to start 2014 with $9 billion in assets, meaning that nearly all of the outside investors will have bailed en masse.

Nearly all, but not all. The Wall Street Journal found one SAC loyalist who isn't going anywhere. And one is the loneliest number. From the Journal:

"I feel like Will Smith in 'I Am Legend' when everyone else has died," said Mr. Butowsky, managing director of Chapwood Investments LLC, an adviser to wealthy clients on hedge-fund and other investments. "I'm the last man standing."

While Butowsky isn't seeking a payout, many of SAC's other major clients like Blackstone already headed for the exits, the Journal reports. As a result, SAC executives have weighed the possibility of turning the fund into looking more like a family office.

Read the full report at the Wall Street Journal>

SEE ALSO: Seriously? JP Morgan Is Being Investigated For Hiring Well-Connected People?

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This just in from Fox Business Network's senior correspondent Charlie Gasparino... 

FBN NEWS: what a way to end a slow week on wall street: stevie cohen telling friends he's resigned to running a family office more at 330

— Charles Gasparino (@CGasparino) August 30, 2013

FBN NEWS: SAC Capital expects all outside $ to leave the fund by years end Steve Cohen is now "resigned" to running a "family office" FBN330

— Charles Gasparino (@CGasparino) August 30, 2013

Back in July, Cohen's $14 billion SAC Capital Advisors was hit with criminal charges of insider trading.

U.S. prosecutors charged SAC "with criminal responsibility for insider trading offenses committed by numerous employees and made possible by institutional practices that encouraged the widespread solicitation and use of illegal inside information," the indictment stated.  

Two of SAC's former portfolio managers have insider trading trials coming up in November. 

The SEC also civilly charged Cohen last month with failing to supervise the two portfolio managers. 

Cohen, 57, launched SAC in 1992.  The hedge fund employs about 900 people worldwide.

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SAC Capital Advisors, the $14 billion hedge fund run by Steven Cohen, is introducing a retention program to keep its portfolio managers and analysts around, CNBC's Kate Kelly reports. 

From Kate Kelly: 

SAC Capital just announced retention program for PMs and analysts. Higher bonuses and base pay for long-short managers, among other things

— Kate Kelly (@KateKellyCNBC) September 4, 2013

SAC offering long-shorts 3% bonus in addition to usual cut of P&L for this year, plus higher base salary in 2014

— Kate Kelly (@KateKellyCNBC) September 4, 2013

SAC trying to stave off a big talent exodus early next year -- even though at 15-25% of PnL they already have some of highest pay in HF land

— Kate Kelly (@KateKellyCNBC) September 4, 2013

In late July, SAC was slapped with criminal insider trading charges. U.S. prosecutors charged SAC "with criminal responsibility for insider trading offenses committed by numerous employees and made possible by institutional practices that encouraged the widespread solicitation and use of illegal inside information," the indictment stated.  

Two of SAC's former portfolio managers have insider trading trials coming up in November.

The SEC also civilly charged Cohen for failing to supervise the portfolio managers. 

Cohen launched SAC in 1992.  The hedge fund has around 900 employees globally. 

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A gentlemen's agreement between hedge fund titans Steve Cohen and Izzy Englander not to poach employees from each other appears to be over.

At least three investment professionals have left Cohen's embattled Stamford, Conn.-based SAC Capital Advisors for Englander's multistrategy shop Millennium Partners in Manhattan in recent months, according to people familiar with the situation.

Alexey Chentsov joined Millennium this month as a portfolio manager focused on quantitative investments in foreign exchange and fixed income. Chentsov was a quantitative analyst at SAC from February 2004 to April of this year.

And Santiago Falconi, an analyst at SAC with the firm since March 2006, also left recently to be a portfolio manager at Millennium; he will join in January.

Both men will work for Andres Anker, a portfolio manager at SAC who left in June for Millennium after nearly 10 years under Cohen, according to people with knowledge of the firm.

Jonathan Gasthalter, a spokesman for SAC, and Carly Westerman, a spokeswoman for Millennium, declined to comment. Chentsov, Falconi and Anker did not respond to requests.

The moves aren't a major change to either firm but underscore the upheaval SAC faces since running into trouble with regulators.

The U.S. government filed a criminal fraud charge in July against SAC for allegedly fostering a culture on insider trading. The firm has contested that and related charges.

Millennium has more than 1,300 employees and 140 specialized trading teams managing $18.5 billion in assets. And SAC runs almost $14 billion as of July 1 using about 1,000 employees, including 125 long-short equity portfolio management teams plus an undisclosed number of quantitatively oriented PMs.

The Millennium International Fund is up 7.13 percent through July, according to a person familiar with the returns. SAC has gained more than 11 percent through August. SAC's assets under management will likely fall to between $9 billion and $10 billion--mostly Cohen's own money--by early 2014 as investor redemptions are processed.

SAC recently moved to retain investment staff, increasing base pay to a minimum of $300,000 in 2014—up from $200,000 in 2013--and adding an incentive bonus of 3 percent for work this year, according to a recent CNBC report.

Several departures preceded those pay increases.

In August, SAC cut one unit, Parameter Capital Management, run by portfolio managers Glenn Shapiro and Anil Stevens.

Stevens is leaving to launch his own fund, according to Reuters. The move was planned before the Securities and Exchange Commission filed charges against SAC.

Many investors have redeemed their money from SAC in the last year. Accordingly, SAC cut about a dozen people on its marketing and investor relations staff in August.

Those departures included Chris Rae, a director who had been with the firm since 2008. Rae did not respond to a request for comment.

Headhunters say it makes sense for SAC employees to consider leaving the firm.

"It would be clearly sensible for anyone at SAC to be exploring other options right now and to be putting their candidacy in early for 2014 hires," said Bob Olman, founder of hedge fund-focused recruiting firm Alpha Search Advisory Partners.

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Imagine you're a trader at SAC Capital and you're watching the headlines about your firm. You might be considering your options.

The truth is, you might have them, and you might not.

This morning, Lawrence Delevingne at CNBC reported that three SAC Capital traders went over to hedge fund Millennium Partners. It's the kind of horse trading we haven't seen since the insider trading related legal troubles at SAC really heated up this year.

And we may not see a lot more. A lot of traders are staying loyal to SAC. They're taking advantage of higher pay and hoping that legal problems that could truly debilitate the firm won't materialize for a few years.

Other traders have no choice. Since Wall Street doesn't really know the extent of the government's case against the firm, the fear that there are more names to be named lingers. That especially casts a shadow over traders that worked in sectors the government is investigating — health care and technology, media and telecoms.

Traders that aren't in those sectors could exit if they want to. Alexey Chentsov, one of the SAC traders that went to Millennium, was a quant portfolio manager. Not a concern to Preet Bahrara and his posse.

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Legal problems haven't stopped SAC Capital from doing what it normally does — make serious cash.

Reuters' Katya Wachtel reports that, as of Friday, the hedge fund is up 13% YTD.

STEVEN A. COHEN'S SAC CAPITAL ADVISORS GAINED ROUGHLY 13 PERCENT AS OF FRIDAY - source

— Katya Wachtel (@katyawachtel) September 25, 2013

According to reports, SAC Capital, helmed by its billionaire founder Steve Cohen, is seeking to settle allegations that it engaged in insider trading.

In the meantime, it's business as usual.

Now, 13% still doesn't beat the S&P 500, which is up 16% YTD, but 13% is a nice number when you compare to the numbers hedge funds of SAC's size have been putting up.

This summer Reuters reported that Pershing Square, Bill Ackman's hedge fund, was up 4% year to date.

Forbes has Greenlight Capital, David Einhorn's hedge fund, up 7.9% as of this summer.

SAC's numbers are getting beaten by another peer's though. Dan Loeb's Third Point has returned 15% YTD, according to Forbes.

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We've heard a rumor based on a source who claims to have seen it that billionaire hedge fund manager Steven Cohen, who runs SAC Capital Advisors, keeps a live and very large pig with a tattoo in his 35,000 square-foot Connecticut mansion.

A spokesperson for Cohen declined to comment for this story. 

Apparently, the tattooed pig is actually a walking piece of art.

Cohen is a huge art collector.  His expansive collection includes pieces by Monet, Picasso, Jasper Johns, Jeff Koons, Damien Hirst, Willem de Kooning, Francis Bacon and Andy Warhol, according to a 2010 Vanity Fair profile. 

We did some research and the only artist known for inking swine is Belgium-born Wim Delvoye. Delvoye is also known for making the Cloaca—a machine that turns food into feces (a.k.a. the "poop machine"). 

Delvoye runs an Art Farm outside of Beijing and has been tattooing live pigs since 2004.  His ink designs can be anything from Louis Vuitton "LVs" to Disney princesses.  We're not sure what sort of tattoo design Cohen's pig has, though. 

So how do you tattoo a pig?

Well, the pig isn't awake during the inking process.   

"To tattoo a pig, we sedate it, shave it and apply Vaseline to its skin," Delvoye said in an interview back in 2007 with ArtAsiaPacific. 

The tattooing actually adds value to the pig.  According to an article in Complex magazine, some of the pigs have sold for over $150,000.  

We were unable to get a comment from Delvoye or his studio at the time of publication. 

If anyone has seen the pig or is aware of the transaction, please email jlaroche@businessinsider.com.

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Facing mounting legal charges, SAC Capital's billionaire manager Steve Cohen will auction a handful of famous pieces of art from his storied collection, the New York Times' Peter Lattman and Carol Vogel report.

Cohen — who has seen redemptions from his fund as his lawyers reportedly broker a $2 billion deal with the SEC over a years-long insider trading investigation — will put up two major Andy Warhol paintings and an "abstract canvas" by Gerhard Richter, sources told the Times.

From the report:

The two Warhols, both painted in 1963, are “Liz #1 (early Colored Liz),” an image of Elizabeth Taylor on a bright yellow background estimated to sell for $20 million to $30 million, and “5 Deaths on Turquoise (Turquoise Disaster),” thought to bring in $7 million to $10 million. Sotheby’s featured the Warhols last week at the Katara Art Center in Doha, Qatar, where it was showing upcoming highlights from next month’s event.

People familiar with Mr. Cohen’s collection said that these paintings were part of a larger group of his works being put up for auction.

In April, Cohen purchased Picasso's "Le Rêve" for $150 million from casino magnate Stephen Wynn. "When you stand in front of it, you’re blown away," Cohen told the Times then in a rare interview.

Cohen's fund — which stood at $15 billion at the beginning of the year — could become just a family office once investor money is returned, a process already underway. About $9 billion of assets under management is Cohen's fortune.

Read the full report at the New York Times »

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The WSJ tweeted earlier that prosecutors are coming to angreement with SAC Capital over insider trading criminal charges. Remember — SAC already paid a $616 million civil fine.

U.S. prosecutors and SAC Capital agree in principle on insider-trading penalty exceeding $1billion. http://t.co/hNaBnT26jX

— WSJ Breaking News (@WSJbreakingnews) October 17, 2013

More specifically, the settlement should end up between $1.2 and $1.4 billion. It also wouldn't sqash any on-going investigations into SAC CEO Steve Cohen's own trading activity.

For the full story, head to WSJ>

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New York Post's Page Six unearthed this gem in a new book about billionaire hedge fund manager Steve Cohen paying Guy Fieri to spend the day with him eating diner food. 

From Page Six: 

Cohen paid Fieri to drive around Connecticut with him to reenact a fantasy episode of “Diners, Drive-Ins and Dives,” reveals Allen Salkin in his book, “From Scratch: Inside the Food Network.”

But after “Cohen paid Guy Fieri $100,000 to be his friend for a day,” Salkin writes the odd couple became so close that the chef’s top-rated show even featured Cohen’s favorite hot-dog spot, the (perhaps appropriately titled) Super Duper Weenie.

A spokesperson for Cohen told Page Six that the story is not true, but said they do know each other.

We found the episode of "Diners, Drive-Ins and Dives" featuring the Fairfield, Connecticut-based Super-Duper Weenie.  In it, Fieri says his "friends" Alex and Steve (a.k.a. Cohen and his wife) were the ones who told him about it.

Fieri said they invited him over to their house for dinner one night and the hot dog truck showed up. 

Also, speaking of the Super Duper Weenie, Cohen got the hot dog truck to stop by SAC Capital Advisor's Stamford, Conn., headquarters the day the fund was criminally indicted on insider trading charges. SAC may end up paying a record fine of $1.8 billion to settle those charges. 

Watch the episode below: 

SEE ALSO: Does Steve Cohen Keep A Live Pig With A Tattoo In His Connecticut Mansion?

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Bloomberg News reports that Stamford, Connecticut headquartered SAC Capital Advisors plans to shut down its London office by the end of this year. 

A bunch of portfolio managers in SAC's London unit, SAC Global Investors, have already left the office located at St. Martins Court on 10 Paternoster Row. 

Back in July, SAC, which is run by billionaire Steve Cohen, was criminally indicted in federal court in New York for insider trading offenses committed by "numerous employees". SAC was charged with four counts of securities fraud and one count of wire fraud. 

This year, the hedge fund, which employees 950 people globally, has been hit with a slew of redemptions.  What's more is many traders and portfolio managers have jumped ship for rival firms.

SAC may end up paying a record fine of $1.8 billion to settle the charges. 

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Federal prosecutors are close to finalizing a settlement with SAC Capital that would end a painful chapter for the embattled hedge fund, according to people familiar with the matter, who added that a deal could be announced as early as this week.

Any settlement between the U.S. Attorney for New York's Southern District and SAC, which was indicted on criminal securities and wire fraud in July, would involve a guilty plea, according to one of these people, and a fine of more than a billion dollars, others familiar with the matter have said.

The basic terms of the settlement have already been hammered out, one of these people added, but a number of more technical issues still need to be resolved.

Spokesmen for the U.S. Attorney's Office and SAC declined to comment.

For SAC, which manages about $13 billion, the admission of guilt is probably more significant than the payout.

Although the exact details of the anticipated plea could not yet be determined, any admission of guilt will probably render SAC unable to manage public money in the future. That means the firm either will have to convert quickly to a so-called family office, solely managing founder Steve Cohen and his senior employees' money, or shut down entirely.

If SAC opts to close, said securities lawyers and a person familiar with the matter, it can move its remaining capital and its staff into a new money-management firm with a new name. But even after that, Cohen, who was sued by the Securities and Exchange Commission in July for failure to supervise errant employees, faces the prospect of a securities-industry bar that would restrict his trading abilities dramatically.

Prosecutors reportedly told SAC that any settlement deal would have to be completed before Nov. 18, which is when the federal trial against longtime SAC manager Michael Steinberg commences.

Eyeing that date and aware of the firm's desire for resolution, SAC employees have been expecting a deal this week, according to someone who works there.

The government has reportedly demanded a fine of $1.8 billion. SAC has held out for a figure lower than that, said someone familiar with the matter, and a deduction from the eventual fine of $616 million it paid earlier this year to settle related SEC charges.

Whether they have prevailed, however, is not yet clear.

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The FT's Kara Scannell reports that hedge fund behemoth SAC Capital will plead guilty to criminal insider trading charges as soon as Monday and face a $1 billion fine.

The firm had been indicted in July.

Scannell writes that the plea basically means SAC is finished:

As a result of the guilty plea SAC will effectively shut as a firm managing other people’s money and close the door on Mr Cohen’s enviable success as a money manager. ... Nearly all of its $6bn from pension funds and wealthy individuals will be returned by the end of the year. It has said it will close its London office and has let go numerous employees.

The fate of fund founder Steve Cohen, who still faces civil charges, remains unknown, Scannell says, but the SEC still wants to ban him from the securities industry. The FBI is still investigating trades by Cohen and other SAC execs, she writes.

At its height, SAC had $15 billion assets under management, and Cohen was said to be worth $9.4 billion.  

Read the full story at FT.com »

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It was expected today and now here it is — hedge fund SAC Capital has plead guilty to insider trading charges. The firm will pay $1.8 billion in fines ($1.2 billion was expected) and close its doors to outside investors.

Here's U.S. Attorney Preet Bahrara's office in the Southern District of New York tweeted about it this morning:

SAC mgmt companies agree to plead guilty to all counts in crim indict, pay $1.8 billion, & terminate SAC Capital’s investment advisory bus

— SDNYnews (@SDNYnews) November 4, 2013

The government indicted the fund back in July, saying the firm's "relentless pursuit of an information 'edge' fostered a business culture within SAC in which there was no meaningful commitment to ensure that such 'edge' came from legitimate research and not inside information."

That essentially means that CEO Steve Cohen's incredible run as one of Wall Street's most sought after money managers is finished. By the end of the year, $6 billion will be returned to outside investors — pension funds, high net worth individuals etc. — and SAC will be a family office with $8 billion AUM.

The FBI, the Justice Department and the SEC have all been involved in investigating SAC in their own ways, and this admission of guilt doesn't end those investigations. The FBI is still going through Cohen's trades, and the SEC is still investigating him as an individual as well. The regulator seeks to ban him from the securities industry entirely.

Until then, as Bloomberg TV's Stephanie Ruhle pointed out, the immediate, painful change at SAC stemming from these legal issues  will be the end of its ability to recruit and keep the best and brightest on Wall Street — Cohen's "power posse."

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