Newspaper article International New York Times

Witness in SAC Case Will Face Sentencing

Newspaper article International New York Times

Witness in SAC Case Will Face Sentencing

Article excerpt

Richard Choo-Beng Lee, a former analyst, is among the last prosecution witnesses to be sentenced. His assistance was critical, a court filing says.

One of the final cooperating witnesses in the United States government's investigation into insider trading at SAC Capital Advisors is soon to be sentenced.

In a court filing on Wednesday, federal prosecutors said the witness, Richard Choo-Beng Lee, would have been an important one if Steven A. Cohen had mounted a legal challenge to the securities fraud indictment that his former hedge fund, SAC Capital, pleaded guilty to almost two years ago.

The authorities said Mr. Lee, a former analyst at SAC who is known as C.B., would have testified at a trial about the "widespread nature of insider trading at the hedge fund." He also would have "provided compelling evidence that SAC Capital's leadership fostered an environment that, at minimum, tacitly encouraged illegal insider trading."

The discussion about Mr. Lee's value as a potential witness against Mr. Cohen's former hedge fund was disclosed in a letter to Judge P. Kevin Castel of the Federal District Court in Manhattan outlining Mr. Lee's "substantial assistance" with the investigation of SAC and a number of people who pleaded guilty to insider trading charges.

Mr. Lee, 59, is scheduled to be sentenced on Tuesday. A United States citizen who was born in Malaysia, he has been cooperating with the government's investigation for six years and pleaded guilty to insider trading charges.

Preet Bharara, the United States attorney for Manhattan, has all but wound down the investigation into insider trading in the hedge fund industry after an appeals court ruling led to the dismissal of charges and convictions against nine people, including two former employees of SAC Capital. The appellate ruling and dismissals have taken some of the luster off Mr. Bharara's record in pursuing insider trading cases. But the guilty plea of SAC Capital and the firm's agreement to pay $1.8 billion in fines and restitution to the federal authorities, including the Securities and Exchange Commission, still stands as one of Mr. Bharara's most prominent achievements.

SAC Capital, which managed over $14 billion at the time it agreed to plead guilty, was also forced to cease managing money for outside investors. Before the guilty plea, SAC Capital had been one of the hedge fund industry's most profitable firms for nearly two decades. …

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