Odey firm gates funds as investors head for exit amid deepening crisis
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Investment firm Odey Asset Management has halted withdrawals from two of its funds and closed another amid an investor exodus as the crisis engulfing the firm deepens following assault allegations against its founder, Crispin Odey.
The firm has banned investors from pulling out any more cash from its Brook Developed Markets Fund and Brook Absolute Return Fund, run by subsidiary Brook Asset Management, after a rush for the exit.
Odey has also decided to close its Swan fund after announcing it was reviewing options for the fund late on Sunday.
It comes as JP Morgan has also reportedly become the last of the major banks to cut ties with the scandal-hit firm as it comes under mounting pressure in the wake of sexual assault and harassment allegations against Mr Odey.
The partnership – which has around 4.4 billion US dollars (£3.5 billion) in assets under management – announced on Saturday that Mr Odey would be leaving following a series of allegations of misconduct.
He denies the allegations.
In a move to further distance itself from Mr Odey, it revealed a management shake-up of funds formerly run by its ousted founder and said it was planning to rebrand the partnership that is set to see Mr Odey’s name removed from the hedge fund.
Odey had insisted on Monday that its funds were open “as per usual business” as it was reported to be considering imposing restrictions.
But it is said to have moved to gate the Brook Developed Markets fund because it had seen a flood of investor redemption requests, which were above 10% of the vehicle’s net asset value.
The authorised corporate director of the Brook Absolute Return Fund, Link Fund Solutions, said in a letter to investors that the decision to suspend dealing was “in the best interests of all investors”.
It said: “Any increased levels of redemptions could lead to the structure of investments in the portfolio not meeting the fund’s stated strategy.
“Therefore, to ensure all investors are protected and treated fairly we believe it is appropriate to suspend the fund.”
JP Morgan’s reported decision to serve notice to end its relationship with Odey comes as another big blow to the firm, and is understood to see it follow the lead of Morgan Stanley, Goldman Sachs and Exane last week.
JP Morgan declined to comment.
Mr Odey and his eponymous firm have been embroiled in a scandal after a Financial Times investigation last Thursday reported a series of allegations of sexual harassment or misconduct from women who either worked at the firm or had social or professional dealings with Mr Odey.
The allegations involve 13 women who claim Mr Odey abused or harassed them, with eight of the 13 saying he sexually assaulted them.
The report sparked the Financial Conduct Authority to widen an investigation into the asset manager having first opened a probe into possible “non-financial misconduct” at Odey Asset Management two years ago.
