Steven A. Cohen’s hedge fund SAC Capital has agreed to a $1.8 billion settlement with the Securities and Exchange Commission, and the deal is expected to include at least one guilty plea, reports Matthew Deluca and Patrick Rizzo for CNBC. The hedge fund has already paid $616 million of the total fee as part of a previous deal, but this is still the largest fine for insider trading in history.

SAC Capital

SAC Capital’s settlement with SEC

Cohen himself is not a defendant in this case, but the settlement doesn’t protect him from civil or criminal prosecution related to the counts of insider trading. Even though SAC is expected to plead guilty as an entity, Cohen himself has not admitted to any wrongdoing. No charges have been made against Cohen, but that could change once the settlement between SAC and the SEC is completely resolved.

“The agreement provides no immunity from prosecution for any individual and does not restrict the government from charging any individual for any criminal offense and seeking the maximum term of imprisonment applicable to any such violation of criminal law,” wrote U.S. Attorney Preet Bharara, who called the settlement “steep but fair.”

SAC Capital gets grace period to redeem clients

Just as important as the fine itself, SAC will have to become a “family business,” only managing Cohen’s personal wealth. That certainly doesn’t mean that SAC Capital is going out of business – Cohen’s net worth is more than $9 billion – but it will no longer function as a hedge fund as it has in the past. SAC will be given a grace period to redeem the balance of its funds to clients, but the exact details aren’t out yet.

Once that happens, SAC will almost certainly cut back on staff. It’s already become fairly clear that the London office will be shut down at the end of this year, and it’s unlikely that the New York office will come through unscathed. Some traders will have the pall of potential lawsuits hanging over them, but for anyone who isn’t being accused of insider trading, there’s likely to be some heavy recruiting among investment banks looking to make the most of a bull market.