Top Hedge Fund on the rope

Discussion in 'Wall St. News' started by lwlee, Feb 22, 2008.

  1. lwlee

    lwlee

  2. The "D.B." stands for douche bag.
     
  3. andread

    andread

    Why did you decide against it?
    I'm curious because I know someone working there, in London. I wonder what he is up to
     
  4. lwlee

    lwlee

    Actually I was leaving the country for a while so I couldn't pursue the job. At the time, they definitely looked impressive something that seemed like a good opportunity if you wanted to work with a formerly elite fund.
     
  5. "Top hedge funds implode"

    "...The funds' demise appears to have little to do with current market volatility. Instead, investors were spooked by a scandal involving a former senior executive at the firm. The fund disclosed last year that Perry Gruss, its former chief financial officer, had improperly transferred client capital between funds in addition to misallocating $12.2 million in expenses to investors. In one instance, Daniel Zwirn's business travel in a Gulfstream G4 jet was charged to investors....."

    IMO, the title for this article is misleading
     
  6. Hedge fund fraud and closures will probably be the theme of 2008
     
  7. Well at least I made one right call in 2008. Shame it was on paper.
     
  8. Here's some blowback. Of course the US funds won't go for it. It'll stop their sleight of hand:

    http://www.ft.com/cms/s/0/3e0a619c-d131-11dd-8cc3-000077b07658.html

    Financial Times FT.com
    FT.com logo


    Investor demands fund checks

    By James Mackintosh

    Published: December 23 2008 23:58 | Last updated: December 23 2008 23:58

    The second-biggest investor in hedge funds will demand that some of the largest names in the industry, including Cerberus, Citadel, DE Shaw and SAC Capital, appoint independent administrators or face it pulling its money.

    Switzerland’s Union Bancaire Privée, in an internal memo, instructed managers of the $56bn it has allocated to hedge funds to put in immediate redemptions for any fund that does not have independent administrators and custodians, following its heavy losses from the alleged fraud by Bernard Madoff.

    The move by UBP has the potential to reshape the US industry, where the oldest and largest funds typically do not use third-party administrators, the common practice in Europe. Many specialists in hedge fund fraud say the use of external administrators, who value the funds’ assets and communicate with investors, provides a valuable check on management power.

    Christophe Bernard, chief investment officer of UBP, told staff by e-mail: “Senior representatives from UBP will meet with the managers of the . . . . funds to attempt to convince them to move to fully independent administration.

    “If accepted by these managers we will consider the situation remedied and rescind redemptions.”

    Mr Madoff, according to several investors, insisted on acting as custodian of assets placed with him, and had no external administrator because he ran a brokerage rather than a hedge fund.

    UBP, which declined to comment, has some of America’s biggest hedge funds on its list to redeem.

    The memo lists funds from ESL Investments, run by Eddie Lampert, chairman of Sears Holdings, the department store group; Renaissance Technologies, run by Jim Simons; Chicago’s Citadel, run by Ken Griffin; DE Shaw, the New York group; SAC Capital, run by Steven Cohen; Millennium International, run by Israel Englander; Cerberus, one of the oldest hedge funds; Dallas-based HBK Capital; and Caxton Associates, run by billionaire Bruce Kovner.

    Caxton already uses a third-party administrator for some functions, according to an investor, while DE Shaw is planning to appoint a bank to confirm its valuations.

    Several hedge funds on the list contacted by the Financial Times said they had no plans to appoint outside administrators.

    Some funds of hedge funds already insist on third-party service providers. Christopher Peel of Blacksquare Capital in London said he would never invest with a fund that did its own administration and valuation.

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