To make it in the largely unregulated hedge fund world, one has to have an edge on the competition, and the savvy founder of SAC Capital Advisors, multi-billionaire and dilettante art collector Steven "Stevie" Cohen had just that. His is what the industry calls the "black edge," where advantage is acquired in the shady underworld of loose-lipped corporate gossip and flat-out illegal insider trading. When Cohen's SAC racked up consistently remarkable 30%-50% returns in the '90s and he began to flaunt his wealth publicly in the art market, a half dozen federal agencies began to dig into his business with the intent to put him away.
In her first book, Black Edge, former financial analyst and staff writer for the New Yorker Sheelah Kolhatkar tells the dramatic story of Cohen's rise and the investigative and legal maneuverings arrayed against him. It is a tale about the allure of money--lusting for it, manipulating it, spending it and ultimately having so much that it no longer means much. It is also a chronicle of the diligent pursuit of justice by overworked bureaucrats, forensic accountants and lawyers (lots of lawyers). In the end, the feds almost got their man, but "left him with only a bruise." The long legal wrangling set Cohen back only a couple billion dollars in penalties, leaving him free to savor the art collection in his massive Greenwich estate. He can go back to wheeling and dealing on Wall Street in two years and do it all over again. --Bruce Jacobs, founding partner, Watermark Books & Cafe, Wichita, Kan.