NEW YORK – Investors in Steven A. Cohen's SAC Capital Advisors will get a bit more time during the second quarter to decide whether to withdraw money from the $15 billion hedge fund.
A source familiar with the hedge fund said on Thursday that the deadline for submitting redemption notices before the end of the quarter on June 30 was extended to June 3 from May 16.
The source, who did not want to be identified, declined to elaborate on why Cohen was giving investors more time to decide whether to withdraw money. But the extension comes at a time Cohen and his firm are drawing increased scrutiny in the federal government's long-running investigation into insider trading.
Just last week, Cohen told investors that, beginning next year, the hedge fund would claw back compensation from employees who are found to use illegally obtained information in making trades.
To date, nine current or former SAC employees have been charged with or implicated in insider-trading while working at Cohen's fund.
Cohen, who has not been charged with wrongdoing, told his investors last week in a letter announcing the claw-back policy: "We have zero tolerance for wrongdoing."
Still, the insider trading investigation has taken a toll. In March, the firm agreed to pay a $616 million penalty to U.S. securities regulators to settle a lawsuit arising from an investigation. Also this year, outside investors submitted requests to pull $1.7 billion from the Stamford, Conn.-based fund.
(This version of the story corrects the original deadline for redemptions requests to May 16 in the second paragraph.)
(Reporting by Matthew Goldstein and Svea Herbst-Bayliss. Editing by Andre Grenon)