The Wall Street kingpin behind the attack on Kasich’s ties to Wall Street

John Kasich this week and Steven A. Cohen in 2012. (Photos: Jim Cole/AP Photo, Scott Eells/Bloomberg via Getty Images)

One of Wall Street’s most controversial traders — a hedge fund kingpin whose firm paid a $1.8 billion fine three years ago after pleading guilty to violating insider-trading laws — is the main financier behind a pro-Chris Christie super-PAC attack ad deriding a GOP rival for his ties to Wall Street.

The attack ad on Christie rival John Kasich, skewering the Ohio governor for once being a “Wall Street banker,” blanketed the airwaves in New Hampshire this morning. It’s part of a $6.9 million ad buy by America Leads, the main super-PAC backing Christie’s candidacy.

“As a banker at Lehman Brothers — a Wall Street bank that failed — Kasich made millions while taxpayers were forced to bail out Wall Street,” the ad proclaims. “John Kasich. Washington insider. Wall Street banker.”

But while the super-PAC ad seeks to capitalize on voter resentment over Wall Street, it may strike some voters as super-rich with irony. The principal bankroller of America Leads is Steven A. Cohen, the Greenwich, Conn., billionaire trader who, together with his wife, has given $4 million to the super-PAC, accounting for nearly one fourth of its $16.1 million haul to date, according to campaign finance reports filed just last week.

John Weaver, Kasich’s chief campaign strategist, said he was unaware of Cohen’s role in backing America Leads until it was pointed out to him Tuesday morning by a Yahoo News reporter seeking comment from the Kasich camp.

Weaver didn’t hesitate to respond. “This is the kind of hypocrisy that has caught up with Chris Christie here in New Hampshire,” he said. “That he would turn to a Wall Street insider to fund an attack on Gov. Kasich for his ties to Wall Street is why he’s not going to have a ticket out of here.”

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The ad, and Weaver’s response, underscores the intense competition in New Hampshire among the four so-called establishment Republicans in the race — Christie, Kasich, Jeb Bush and Marco Rubio. Instead of going after Donald Trump, who remains the frontrunner in the polls, or Ted Cruz, the winner in Iowa, they have been attacking each other, with verbal swipes and blistering attack ads funded by their super-PACs.

But so far, the wealthy donors behind the attack ads have gotten relatively little, if any, attention. That is especially surprising in the case of Cohen, given his high public profile. As the owner of hedge fund SAC Capital, he was for years one of Wall Street’s most successful traders, catapulting him into the ranks of America’s super-rich, with an estimated net worth of $13 billion, according to Forbes.

But his firm became the target of a wide-ranging federal investigation into insider trading by the office of the U.S. attorney in New York, Preet Bharara. The probe helped inspire the new Showtime TV series “Billions,” starring Damian Lewis, as a hedge fund kingpin loosely based on Cohen, and Paul Giamatti, as the relentless U.S. attorney pursuing him and who bears some resemblance to Bharara.

The investigation reached its climax in 2013 when SAC Capital pleaded guilty and agreed to pay $1.8 billion in penalties. SAC Capital has since changed its name to Point72 Asset Management, and only manages Cohen’s money. Cohen himself was never charged, and federal appeals courts have since overturned the convictions of other Wall Street traders caught up in the SAC probe, narrowing the definition of what constitutes insider trading. But just last month, Cohen reached a final settlement with the Securities and Exchange Commission that will restrict him from serving as a supervisor of a registered investment fund until 2018.

A spokeswoman for Cohen declined to comment. But while not addressing Cohen’s financial backing, Tucker Martin, a spokesman for America Leads, defended the ad as a legitimate attempt to educate New Hampshire voters about Kasich’s background, in the context of a vote he took in Congress on a measure to help shore up Wall Street banks.

“The Kasich team has spent well over a month attacking Gov. Christie,” Martin said. “All we’re doing is noting a vote Gov. Kasich took and a job he held. It’s simply another part of his bio and his record, presented to voters for their consideration.”

Kasich’s ties to Lehman Brothers have come up before in the campaign. Between 2001 and 2008, after leaving Congress, he served as a managing director in an Ohio regional office of the Wall Street firm before it failed in one of the seminal events that triggered the financial crisis. The America Leads ad shows a brief clip from an earlier Republican debate in which Trump points at Kasich saying, “This is the man who was a managing general partner at Lehman Brothers.”

Trump’s comments drew immediate fire from Kasich’s camp, and some fact checkers, for overstating his role. They pointed out that the Ohio governor was never a partner or on the board at Lehman Brothers, only an employee. Weaver today called the attack on Kasich “ridiculous,” adding: “He was a banker in a two-person office in Columbus.”

Nor is Cohen the only Wall Street investor who is helping to finance the America Leads super-PAC. A check of the latest campaign finance records, as compiled by the Center for Responsive Politics, shows that hedge fund, private equity and investment executives and their firms — including prominent Wall Street figures like Bruce Kovner, Ken Langone and Herbert Allen Jr. — account for at least another $4 million of its contributions.