Hedge fund Two Sigma may have to pay up to $100 million to settle a Securities and Exchange Commission investigation into the firm's trading scandal. The Wall Street Journal reported. Thursday.
The hedge fund is likely to be held accountable for how it oversaw a former employee at the center of fraud that led to hundreds of millions of dollars in unexplained losses and gains, according to reports.
The researchers are suspected of modifying the trading model without authorization.
Two Sigma is in discussions with regulators that could result in a reduction in the amount it pays the company, the people added.
The SEC and Two Sigma did not immediately respond to Reuters requests for comment.
Sigma co-founders John Overdeck and David Siegel decided to step down as CEO in August.
The hedge fund, which has $60 billion in assets under management, said in a regulatory filing last year that discord among its top managers had created governance challenges and posed a significant risk to the firm.
Overdeck and Siegel, who founded Two Sigma in 2001, will continue to serve as co-chairmen.
