The SAC saga continues.

[ by Melanie Gretchen ]

SAC Capital Advisors portfolio Michael Steinberg hasn't escape prosecutor scrutiny.  Though he was previously named as an unindicted co-conspirator in a criminal prosecution case involving 2 other recently convicted hedge fund traders, there's is no guarantee the feds will forget about him.  Here, in 2013, prosecutors are considering whether to pursue criminal charges to Mr. Steinberg related to an insider trading investigation involving shares of Dell Inc. - possibly because they were unable to get any cooperation from another SAC manager, Mathew Martoma, who was indicted November 2012.  

Who is Mr. Steinberg? Mr. Steinberg, 40, made a name for himself since joining SAC in 1997.  During his time at the 900-employee fund, he has been part of a group of top SAC traders who hold Sunday phone calls with Cohen and share their best trading ideas;  now he serves as technology portfolio manager with SAC Capital's Sigma Capital division.  In 2009, he bought a penthouse on Park Avenue for $8 million and vacations regularly in the Hamptons.

Prosecutors presumably may indict him in connection to the e-mails that were featured in the trial of Todd Newman and Anthony Chiasson, who had also traded Dell shares; the e-mails showed Mr. Steinberg and his colleagues discussing Dell's earnings before they went public.  However, what charges may come has yet to be revealed.  Neither SAC Capital, nor Dell has issued a comment, though Mr. Steinberg's lawyer, Barry Berke, said his client "did absolutely nothing wrong."

However, if Mr. Steinberg is charged by federal authorities, the 6-year case against SAC would continue to snowball.  To date, prosecutors have secured a handful of convictions against former SAC employees for insider trading at firms they joined after leaving SAC Capital.  And getting closer to the top – closer to founder Steven Cohen – may be something that Mr. Steinberg can't afford.

For further details, go to [Reuters, 2/7/13].