There are dark and disturbing things lurking in the waters at SAC Capital Advisors in Stamford, Connecticut, and we’re not talking about its billionaire founder’s shark in formaldehyde. Recently, the spotlight was shone on the notoriously secretive hedge fund when a former employee became a cooperating witness in the Galleon Group insider-trading case, and today, Reuters reporter Matthew Goldstein unearthed recently unsealed documents from a 2007 sexual-harassment complaint filed by former SAC trader Andrew Tong against his boss, portfolio manager Ping Jiang, which not only list his specific allegations in graphic detail but paints a picture of a culture that encouraged people to be so single-minded in their pursuit of profit that they became not only capable of dismissing moral and ethical standards, but also basic human decency.
“Steven Cohen only wants us to make money, he doesn’t care or want to know our secrets to make money,” Tong quotes his former boss Ping Jiang saying in the complaint. In Jiang’s case, Tong says, those secrets included a distinctive “training program” to which he was subjected during his first year as a trader.
As a condition of Mr. Tong’s continued employment with SAC, Mr. Jiang required him to wear subtle feminine attire in the workplace during business hours (Including blouses, slacks, shorts, and open-toed sandals). After hours, Mr. Jiang demanded Mr. Tong wear more obviously feminine attire in the workplace (consisting of bras and panties, blouses, skirts, dresses, and high-heeled sandals). On more than one occasion, Mr. Jiang summoned Mr. Tong into an empty conference room after business hours and forced him to disrobe and model various feminine outfits as well as put on makeup. During these humiliation sessions, Mr. Jiang would make comments to Mr. Tong such as, “Don’t worry, you’ll get prettier with makeup” and “you look cute in that,” and “That looks sexy on you.” This forced feminine dressing occurred throughout the course of Mr. Tong’s employment at SAC, moreover, during this entire period of time, Mr. Jiang also insisted Mr. Tong grow his hair long and wear makeup such as lipstick and nail polish. Not surprisingly, several of Mr. Tong”s co-workers commented on his appearance … Thereafter, Ari Kiev, a workplace psychologist retained by Mr. S. Cohen to enhance the performance of trader/analysts at SAC observed Mr. Tong wearing feminine attire in the workplace but did not say anything to him or Mr. Jiang (as far as he was aware)
It gets worse.
Up through March of 2006, Mr. Jiang insisted that Mr. Tong continue taking female hormones so as to “shape” his personality into “a combination of male and female traits,” including being “dedicated, hard-working, subservient and detail-oriented.” Moreover during that period of time, Mr. Jiang continued to pressure Mr. Tong to perform oral sex on him as a condition of Mr. Jiang authorizing Mr. Tong’s trades. In this regard, Mr. Jiang remarked to Mr. Tong, “You’ll have to give me a blowjob if you want to make that trade.”
There are also ropes, urine, and objects inserted into rectums, but we won’t get into that. The point is: By Tong’s own admission, this went on for a full year, and only ended when he was forcibly fired for losing $3 million on a trading scheme involving shares of a Chinese engine-manufacturing company that, again, he by his own admission admits was manipulative. Only then did he decide to fight back and sue. Why would someone put up with all of this, for so long? Well, money, of course.
Mr. Jiang reiterated his promise that Tong would make millions of dollars if (and only if) he followed Mr. Jiang’s directions unconditionally. Intimidated by Mr. Jiang’s authority and backing by senior management, as well as lured by Mr. Jiang’s promise of making millions of dollars, Mr. Tong again submitted to his superior’s demands.
In the end, following orders didn’t work out for Tong, and neither did suing. His case against SAC was closed last year, and an investigation into his claims by the Equal Opportunity Commission also dried up. He didn’t get a cent.
UPDATE: Dealbreaker’s intrepid Bess Levin got her hands on a psychiatric evaluation of Tong. It is gross, and also sad. For example: “During the interviews, when asked directly why he obeyed the unusual alleged demands of Mr. Jiang, Mr. Tong repeatedly described thinking he was convinced that Mr. Jiang was a powerful and successful man who was a ‘great financial trader.’ He reported desperately wanting to stay employed at SAC. He wanted to learn how to become a great financial success. As a result, he did not mind wearing women’s clothing or taking the hormones. He said that if he became a successful millionaire, no one would care if he had engaged in those behaviors. Also, if people did care, it would not matter to him because he would be a successful millionaire.”
The FBI agent inside the Galleon case [Reuters via Dealbreaker]
Earlier: The Tong Song