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Castlestone confirms it is under FSA regulatory investigation

Wednesday, July 20, 2011

Angus Murray
Opalesque Industry Update - On Wednesday, Castlestone confirmed in a statement that the FSA had visited its offices that day due to an investigation taking place. “The company is cooperating fully with that investigation. A further statement will be made by the company as soon as possible.”

Portfolio Advisor reported that the FSA has issued search warrants on two premises in London and one in Chichester, and Castlestone confirmed that its offices were under investigation. The commodity based fund firm has seen several departures over the past few months including those of Connor Noonan, Bradley Tim and Arrash Zafari, compliance head Ed Williamson and other compliance and trade personnel have left the firm in 2011.

According to the Portfolio Advisor report, two of the firm’s UCITS funds have been struggling with the precious metals fund down -1.15% 2011 and the multi-asset portfolio down 5.96% YTD. However, these losses are in line with wider hedge fund industry losses. The firm has also reported that its agriculture fund is up 44% in the past 12 months. When the firm launched the precious metals fund in 2010, Castlestone CEO Angus Murray was bullish on metals as a shield against currency devaluation in volatile times.

Portfolio Adviser notes that all four of the UCITS funds that are domiciled in Ireland (including the precious metals fund) saw the Central Bank of Ireland temporarily suspend subscriptions into the accounts on June 1, but that ban was lifted 10 days later.

Kirsten Bischoff

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