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UBP threatens to put in immediate redemptions for any fund that does not have independent administrators and custodians

Friday, December 26, 2008

According to the FT, the second-biggest investor in hedge funds will demand that some of the largest names in the industry, including Cerberus, Citadel, DE Shaw and SAC Capital, appoint independent administrators or face it pulling its money. Switzerland’s Union Bancaire Privée, in an internal memo, instructed managers of the $56bn it has allocated to hedge funds to put in immediate redemptions for any fund that does not have independent administrators and custodians, following its heavy losses from the alleged fraud by Bernard Madoff.

The memo lists funds from ESL Investments, run by Eddie Lampert, chairman of Sears Holdings, the department store group; Renaissance Technologies, run by Jim Simons; Chicago’s Citadel, run by Ken Griffin; DE Shaw, the New York group; SAC Capital, run by Steven Cohen; Millennium International, run by Israel Englander; Cerberus, one of the oldest hedge funds; Dallas-based HBK Capital; and Caxton Associates, run by billionaire Bruce Kovner. Caxton already uses a third-party administrator for some functions, according to an investor, while DE Shaw is planning to appoint a bank to confirm its valuations.

Several hedge funds on the list contacted by the Financial Times said they had no plans to appoint outside administrators.... Full article: Source

Opalesque Note: Also Switzerland is celebrating public Christmas holidays including today (D......................

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