Wed, May 25, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Corporate Resolutions Inc announces ethics hotline for hedge funds

Tuesday, March 08, 2011
Opalesque Industry Update -Corporate Resolutions Inc., a worldwide business investigations and consulting firm, announces its Ethics Hotline is now available to hedge funds as a tool for transparency. With the Galleon trial beginning today and the public consciousness raised about insider trading, hedge funds have become the unnecessary recipient of negative exposure. Implementing the Ethics Hotline at hedge funds is an ideal way to prevent fraud, insider trading and other forms of wrongdoing and show pension funds, fund-of-funds (FOFs) and other investors that hedge funds, like other firms, strive for ethical transparency.

“The Ethics Hotline gives investors, hedge fund managers and others a proactive approach to minimizing the vulnerability of fraud and sends a message to employees and future investors that the firm is committed to maintaining ethical business practices”

“Although there is no guaranteed method for preventing insider trading, the implementation of an Ethics Hotline, gives hedge funds a set of eyes on the inside, and may be the best option for deterring such behavior,” said Kenneth S. Springer, a former FBI agent and President and Founder of Corporate Resolutions Inc.

The Ethics Hotline allows employees and others to anonymously report illegal or unethical behavior via telephone or email. The complaints are then vetted by Corporate Resolutions, an independent third party, and the findings are discussed with the firm and/or outside counsel to determine the legitimacy of the complaint and what necessary actions need to be taken. (Hedge funds may consider retaining the Ethics Hotline services through outside counsel potentially for privilege purposes.)

“The Ethics Hotline gives investors, hedge fund managers and others a proactive approach to minimizing the vulnerability of fraud and sends a message to employees and future investors that the firm is committed to maintaining ethical business practices,” said Mr. Springer. “For years, Corporate Resolutions Inc. has offered the Ethics Hotline to private equity firms as a system of checks and balances for portfolio companies and it has become a proven tool for investors who seek to avert malfeasance in the workplace.”

Whistleblower hotlines gained prominence through Sarbanes-Oxley which called for every publicly traded company in the U.S. to offer some form of a whistleblower component. And, whistleblower hotlines have also been gaining some popularity through the Dodd-Frank Act. It is likely that before the SEC acts on whistleblower tips (as a result of this legislation), companies will be required to demonstrate they exhausted internal means first. According to the Association of Certified Fraud Examiners (ACFE) 2010 Report to the Nation on Occupational Fraud and Abuse, tips were by far the most common detection method in catching nearly three times as many frauds as any other form of fraud-related surveillance.

In an economic environment when investment firms need to show investors they have adequate safeguards in place to prevent fraud, the Ethics Hotline is an easy solution for hedge funds and expert network firms. The hotline appeals to regulators who continue to scrutinize firms that are knowingly vulnerable to insider trading, violations of the Foreign Corrupt Practices Act (FCPA), and Ponzi schemes.

Source

(press release)

kb

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Paul Tudor’s hedge fund trims fee amidst poor performance, keep investors[more]

    Komfie Manalo, Opalesque Asia: Paul Tudor’s $11.6bn hedge fund firm Tudor Investment Corp. announced on Monday it would slash down fees of one of its biggest fund to 2.25% of assets and 25% of profits amidst backlash arising from poor performa

  2. West Virginia objects to Alpha Natural sale to hedge fund[more]

    From AP/Heraldcourier.com: West Virginia's environmental authority has filed an objection to the proposed $500 million sale of Alpha Natural Resources' assets to a hedge fund, arguing that the deal could leave the state holding hundreds of millions in reclamation liabilities. The Register-Hera

  3. Mitch Petrick leaves Carlyle as his hedge fund unit suffers losses while assets expand[more]

    Komfie Manalo, Opalesque Asia: Mitch Petrick will be leaving Carlyle Group as head of its hedge funds unit overseeing about $34bn as of March 31, after several funds under his management suffered losses while assets expanded, various media reported. Petrick joined Carlyle in 2010 and was a former

  4. Institutions - Kentucky pension leans into hedge funds amid governance turmoil, Korea's NPS names finalists for initial $1 billion hedge fund-of-funds allocation[more]

    Kentucky pension leans into hedge funds amid governance turmoil From AI-CIO.com: The Kentucky Retirement Systems moved to increase its hedge fund allocation as controversy reigned over fund leadership. Following a string of high-profile hedge fund exits, the Kentucky Retirement Systems (

  5. Fund Profile - The hedge fund that couldn't stay open long enough for a big payday[more]

    From Bloomberg.com: Toby Dodson waited six months for his bet against a fragile Portuguese bank to pay off. But before the reckoning, word came down from his hedge fund bosses at Achievement Asset Management in Chicago: get ready to clear out your desk and unwind your trades, we’re shutting down. Th