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The UK’s high monetary regulator is urgent funding platforms together with AJ Bell, Hargreaves Lansdown and Halifax on their continued offering of funds from Odey Asset Management to retail investors, individuals accustomed to the scenario informed the Financial Times.
A string of funds have already been suspended within the fallout from sexual misconduct allegations in opposition to the hedge fund agency’s founder, Crispin Odey.
The allegations led to his ousting from the agency he based in 1991 and have prompted banks that supplied key companies to the hedge fund to sever ties. He strenuously denies the allegations.
Odey Asset Management, which managed about $4.4bn earlier than the scandal hit, is within the technique of breaking itself up by promoting off funds and the agency stays the topic of a two-year-old investigation by the Financial Conduct Authority into company governance points.
According to individuals accustomed to the scenario, the FCA contacted funding platforms this month about their continued offering of funds branded underneath Odey’s identify, or underneath Brook, the identify given to funds managed by different companions of Odey Asset Management, together with Oliver Kelton and James Hanbury.
One particular person accustomed to the discussions mentioned the FCA wished the funding platforms to clarify how persevering with to supply the funds was in the perfect pursuits of their shoppers, given the problems at Odey Asset Management.
Odey Asset Management declined to remark.
Risks dealing with retail investors — who might not have heard about Odey Asset Management’s difficulties — embrace potential additional suspensions and restrictions on withdrawals.
An individual at one funding platform mentioned there had “been a conversation” with the FCA in regards to the continued presence of Odey-related funds however that the regulator was not “challenging” the platform’s strategy.
An individual at one other platform mentioned whereas the funds have been on supply, their platform had not offered a single Odey funding for the reason that FT first reported the allegations in opposition to Crispin Odey on June 8. “These are relatively specialist funds and are held by very few customers,” the particular person added.
A fourth mentioned their platform had not eliminated the funds as a result of there was a “protocol” for taking funds offline. This had not been activated “as [the] FCA [is] monitoring the situation, [is] keen to stabilise and will advise us and other platforms on next steps”.
The platforms supply the funds on a supermarket-style platform the place DIY investors can decide and select their holdings, relatively than selling or recommending them, which means that investors have to seek for them to purchase.
The FCA’s conversations with the platforms had been wider than asking about why Odey and Brook funds have been nonetheless accessible for buy, in accordance to a number of individuals accustomed to the scenario.
The watchdog has additionally been asking for info on the extent of shopping for and promoting of the funds, and has been speaking to platforms in regards to the orderly switch of any funds which can be being offered by Odey Asset Management to third events.
The FCA, Halifax, Hargreaves Lansdown and AJ Bell all declined to remark.
Odey Asset Management mentioned this week that it was in “advanced talks” about transferring 4 funds run by Kelton to funding boutique SW Mitchell Capital. Odey Asset Management can be making an attempt to transfer sure different funds, and portfolio managers, to new homeowners.
