The SEC said on Friday that Martoma engaged in insider trading in 2008 at CR Intrinsic Investors, a wholly-owned subsidiary of SAC Capital Advisors - an entity founded and controlled by Cohen.

Cohen “ignored red flags that should have caused him to take prompt action to determine whether Martoma was engaged in insider trading,” the SEC said in a statement. “Instead, Cohen permitted Martoma to make trades based on that information, and Cohen placed similar trades in accounts that Cohen controlled.”

In November 2012, the SEC charged CR Intrinsic and Martoma with insider trading and in March 2013 CR Intrinsic agreed to pay over $600 million to settle the charges.

As part of Friday's settlement, Cohen’s family office firms will be subject to SEC examinations and must retain an independent consultant to conduct periodic reviews of their activities to ensure compliance with securities laws.

“Before Cohen can handle outside money again, an independent consultant will ensure there are legally sufficient policies, procedures, and supervision mechanisms in place to detect and deter any insider trading,” said Andrew Ceresney, director of the SEC’s enforcement division. “The strong combination of a two-year supervisory bar and additional oversight requirements achieves significant and immediate investor protection and deterrence, while ensuring that the activities of his funds are closely monitored going forward.”

The accord is a victory for Cohen, whose Stamford, CT-based firm, now called Point72 Asset Management, manages his roughly $11 billion fortune, Reuters said. “It allows Cohen to resume managing money for outside investors as soon as January 1, 2018, without the overhang of a potential lifetime ban.”

SAC pleaded guilty to fraud in 2013 and paid $1.8 billion in criminal and civil settlements, as reported by Family Wealth Report here.