FCA investigating Odey Asset Management

The UK’s prime monetary regulator is investigating Odey Asset Administration, the hedge fund agency whose founder Crispin Odey is dealing with greater than a dozen accusations of sexual assault and harassment, folks aware of the scenario instructed the Monetary Occasions.

The Monetary Conduct Authority opened an investigation into Odey Asset Administration two years in the past, based on one particular person aware of the probe.

The FCA’s investigation was initially targeted on non-financial misconduct, based on the particular person, however later shifted to company governance points after Odey fired his government committee in 2021.

The regulator might now widen its investigation to think about potential non-financial misconduct by Odey, following an FT investigation that chronicled how the hedge fund supervisor evaded sexual assault allegations for many years, the particular person aware of the probe added.

On Thursday Morgan Stanley additionally moved to sever ties with the agency within the wake of the FT story. In response to folks aware of the scenario, the financial institution has begun the method of terminating its prime broking relationship with Odey.

Morgan Stanley and Odey Asset Administration declined to remark and didn’t instantly reply to requests to touch upon the FCA probe.

The FCA instructed the FT: “We’re unable to touch upon people or particular companies. Nevertheless, we take allegations of non-financial misconduct severely and anticipate companies to have sufficient governance procedures in place that ensures allegations of misconduct are correctly investigated.”

Odey instructed Reuters on Thursday that Morgan Stanley’s transfer was “a massively fast response to an allegation by the FT”.

JPMorgan can be reviewing its prime broking relationship with Odey Asset
Administration in gentle of the allegations within the FT, based on two
folks aware of the scenario. JPMorgan declined to remark.

Prime brokers provide a spread of companies to their hedge fund shoppers, together with inventory lending, leverage and commerce execution. Additionally they hyperlink hedge funds with potential buyers corresponding to pension funds, foundations and endowments.

Harriett Baldwin, a Conservative MP who chairs the Treasury choose committee, mentioned: “The Monetary Occasions has printed an necessary piece of journalism and the vary of girls they’ve interviewed paints a troubling image of an inappropriate work atmosphere.

“I’m positive buyers and potential buyers within the funds, workers and potential workers and the regulator will learn this text with concern.”

Morgan Stanley’s choice got here after the publication of an FT investigation on Thursday into allegations that Odey had sexually harassed or assaulted 13 girls over the previous 25 years. Eight of the ladies included within the investigation alleged that they had been sexually assaulted by him. A legislation agency representing Odey mentioned allegations made in opposition to him had been “strenuously disputed”.

The FT revealed that Odey fired his government committee in December 2021, after they tried to self-discipline him for breaking a “remaining written warning” prohibiting him from behaving inappropriately with feminine workers.

The latest alleged sexual assault happened throughout the identical month after a cocktail party in Odey’s Gloucestershire mansion, Eastbach Courtroom. He invited a feminine acquaintance to debate a authorized matter one-on-one in his sitting room. When the dialogue ended, he violently groped her by grabbing her breasts, forcing his tongue into her mouth and clamping her hand to his erect penis.

The investigation additionally discovered that companions at Odey Asset Administration had been conscious of his alleged mistreatment of girls way back to 2004 when a receptionist, Jae-Ann Maher, resigned and initiated a authorized grievance in opposition to the agency.

In her resignation letter she mentioned she was “susceptible to receiving undesirable and unrequested sexual consideration from Mr Crispin Odey” within the type of “massages, kisses, embraces and crude sexually suggestive feedback”. It took one other 16 years for the agency’s government committee to formally examine the behaviour of its founder. 

Jess Phillips, a Labour MP and shadow minister for home violence and safeguarding, mentioned the FCA ought to “completely perform their very own investigation and provides these severe allegations of sexual assault the eye they deserve”.

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 of the agency in November 2020, though he remained the bulk shareholder. 

That month the corporate established a brand new subsidiary, Brook Asset Administration, and later rebranded nearly half of its funds beneath the Brook identify. 

Further reporting by Laura Hughes in London

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