Hedge Fund Pleads Guilty, but Tycoon Gets Off

SAC Capital pleaded guilty to all five counts in the damning criminal complaint against it yesterday, agreeing to a total of $1.8 billion in penalties, the largest haul ever for an insider trading case. The plea marks the end of an 11-year case, and marks the first time "in a generation" that a Wall Street firm has confessed to criminal conduct, the New York Times reports. But prosecutors weren't able to lay a hand on the real apple of their eye, SAC founder Stephen A. Cohen.

Sources tell the Wall Street Journal that, barring new evidence, Cohen will never be charged personally with a crime, and though SAC will now be barred from managing money from outside investors, it will likely continue managing Cohen's massive fortune—and hence continue to be a market force. Traders speculate that Cohen, meanwhile, will simply found a new company to manage client money. Asked if they were disappointed, prosecutors defended the fines as "very substantial." SAC, meanwhile, released a statement decrying the "handful" of "wrongdoers" who had pleaded guilty. (More SAC Capital Advisors stories.)