NEW YORK (AP) — A senior portfolio manager for one of the nation’s largest hedge funds was arrested Friday, accused of making $1.4 million illegally in a widening insider trading probe involving an investment company founded by billionaire businessman Steven A. Cohen.
Michael Steinberg, 41, pleaded not guilty Friday, hours after he was arrested at his Manhattan home on insider trading charges lodged in an indictment unsealed in U.S. District Court in New York City. He is a senior portfolio manager at SAC Capital Advisors.
His attorney, Barry Berke, said in a statement that Steinberg “did absolutely nothing wrong.” He said Steinberg’s trading decisions were based on detailed analysis along with other information he properly obtained.
“Caught in the crossfire of aggressive investigations of others, there is no basis for even the slightest blemish on his spotless reputation,” he said.
In a statement, SAC Capital, which manages $15 billion, said Steinberg “has conducted himself professionally and ethically during his long tenure at the firm. We believe him to be a man of integrity.”
U.S. Attorney Preet Bharara said in a statement that Steinberg “was another Wall Street insider who fed off a corrupt grapevine of proprietary and confidential information cultivated by other professionals who made their own rules to make money. With lightning speed in at least one case, Mr. Steinberg seized on the opportunity to cash in and tried to keep his crime quiet, as charged in the indictment.”
George Venizelos, head of the FBI’s New York office, said the arrest was the latest in an FBI probe that has resulted in more than 70 arrests.
At least four other people associated with the Stamford, Conn.-based firm have been arrested over a period of about four years.
Spending, incomes increased in February
WASHINGTON (AP) — Consumers earned more and spent more in February, helped by a stronger job market that has offset some of the drag from higher taxes.
The Commerce Department said Friday that consumer spending rose seven-tenths of a percent in February from January. It was the biggest gain in five months and followed a revised rise of four-tenths of a percent in January, which was double the initial estimate.
Americans were able to spend more because their income rose 1.1 percent last month. That followed January’s 3.7 percent plunge and December’s 2.6 percent surge. The huge swings reflected a rush to pay bonuses and dividends in December before taxes increased.
After-tax income increased 1.1 percent last month.
The jump in income allowed consumers to put a little more away in February. The saving rate increased to 2.6 percent of after-tax income, up from 2.2 percent in January.
Consumers spent more at the start of the year even after paying higher taxes. An increase in Social Security taxes has reduced take-home pay for nearly all Americans receiving a paycheck. And income taxes have risen on the highest earners. The tax increases took effect Jan. 1.
United Auto Workers gains more members
DETROIT (AP) — The United Auto Workers union says its membership rose slightly last year as the U.S. manufacturing sector continued its recovery.
The UAW said Thursday it had 382,513 members in 2012. That was an increase of nearly 1,800 workers — or less than 1 percent — from the previous year.
The union said it gained members at auto parts plants in Alabama and Kentucky and a bus factory in Oklahoma. More than 1,000 workers at a casino in Cleveland also joined the union last year.
Membership is up nearly 8 percent from 2009, amid the recession. But it is still far below its peak of 1.5 million in 1979.