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Morgan Stanley strikes to sever relationship with hedge fund supervisor following FT investigation
Odey Asset Administration faces a widening investigation by the UK’s Monetary Conduct Authority and the lack of key banking relationships after 13 girls made allegations of sexual assault and harassment in opposition to founder Crispin Odey.
The UK’s high monetary regulator opened an investigation into potential “non-financial misconduct” on the hedge fund two years in the past, in response to individuals accustomed to the probe.
The inquiry later shifted to look at company governance points after Odey fired his government committee in 2021, these individuals stated, and it could now be widened to think about contemporary allegations of sexual assault reported in a Monetary Instances investigation on Thursday.
The FCA stated it was unable to touch upon “people or particular corporations” however added: “Nevertheless, we take allegations of non-financial misconduct severely and count on corporations to have ample governance procedures in place that ensures allegations of misconduct are correctly investigated.”
Information of the FCA probe got here after Morgan Stanley moved to sever ties with the agency after the FT investigation. Prime brokers reminiscent of Morgan Stanley present credit score to hedge funds to facilitate their buying and selling.
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Odey on Thursday instructed Reuters that Morgan Stanley’s transfer was “a massively fast response to an allegation by the FT”, including that “not one of the allegations have been stood up in a courtroom or an investigation”.
The FT investigation revealed that 13 girls alleged they’d been sexually harassed or assaulted by Odey over the previous 25 years. A regulation agency representing Odey stated allegations made in opposition to him have been “strenuously disputed”.
The newest alleged sexual assault occurred in December 2021 after a cocktail party in Odey’s Gloucestershire mansion, Eastbach Court docket. A feminine acquaintance of Odey instructed the FT she was invited to debate a authorized matter alone with him earlier than he violently groped her.
The investigation additionally discovered that companions at Odey Asset Administration have been conscious of his alleged mistreatment of ladies way back to 2004 when a receptionist resigned and initiated a authorized grievance in opposition to the agency.
In her resignation letter she stated she was “liable to receiving undesirable and unrequested sexual consideration from Mr Crispin Odey” within the type of “massages, kisses, embraces and crude sexually suggestive feedback”.
The FT investigation revealed that the agency’s government committee tried to self-discipline Odey in December 2021 for breaking a “closing written warning” prohibiting him from behaving inappropriately with feminine employees. As a substitute, Odey fired the committee.
JPMorgan and Goldman Sachs are reviewing their prime broking relationship with Odey Asset Administration in mild of allegations within the FT, in response to individuals accustomed to the scenario. JPMorgan and Goldman declined to remark.
Jess Phillips, a Labour MP and shadow minister for home violence and safeguarding, stated the FCA ought to “completely perform their very own investigation and provides these critical allegations of sexual assault the eye they deserve”.
Harriett Baldwin, a Conservative MP who chairs the Treasury choose committee, stated: “The vary of ladies . . . paints a troubling image of an inappropriate work atmosphere.” She added: “I’m certain traders and potential traders within the funds, workers and potential workers and the regulator will learn this text with concern.”
The agency’s belongings beneath administration have fallen from their peak of $13.3bn a number of years in the past. Odey stepped down as co-chief government in November 2020, though he remained the bulk proprietor.
That month Odey Asset Administration established a subsidiary, Brook Asset Administration, and later rebranded nearly half of its funds beneath the Brook identify.
Morgan Stanley, JPMorgan and Odey Asset Administration declined to remark.
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