By Nell Mackenzie
LONDON (Reuters) – Odey Asset Management is restricting the money clients can pull from its Brook Developed Markets Fund, according to an investor letter, a further sign of the fallout at the hedge fund firm after media allegations of sexual misconduct by its founder.
In the letter dated June 12, and seen by Reuters on Tuesday, the OAM board said it took the decision to gate the Brook Developed Markets Fund after it faced “redemption requests in excess of ten per cent of the net asset value,” prompting the company to restrict more withdrawals.
A OAM spokesperson declined to comment but confirmed the letter. OAM on Monday said it wasn’t considering imposing exit restrictions on any of its funds.
Crispin Odey has denied the allegations of misconduct, which were jointly reported by the Financial Times and Tortoise on Thursday.
He did not respond when contacted by Reuters on Tuesday.
It is the responsibility of the board to protect other retail customers from the falling value of the funds if there is a rush of investor exits. Brook Developed Markets Fund is open to retail investors and had about $216 million, as of end February, the latest data from Morningstar showed.
The company over the weekend sought to distance itself from Crispin Odey, saying the financier would be leaving the firm.
In a letter to investors signed by the firm’s partners and seen by Reuters the firm set out a succession plan, including naming replacement managers for key funds, as the firm sought to end “personal and economic involvement” with Crispin Odey.
OAM had $4.8 billion in assets under management as of September 2022.
Within hours of the FT and Tortoise report last week, OAM’s prime brokers including Goldman Sachs, JPMorgan and Morgan Stanley were reviewing their relationships with the hedge fund.
(Reporting by Nell Mackenzie; Editing by Dhara Ranasinghe and Elisa Martinuzzi)
