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Howard Altman From Kirsten Bischoff, Opalesque New York:
The first muscle flexing from institutional investors unsatisfied with hedge fund infrastructures following the credit crisis came from UBP, which demanded all underlying managers utilize third party administrators. Soon, some of the largest and oldest hedge funds still performing their own in-house administration services were transitioning those responsibilities onto third party providers and assuaging investor worry over unnecessary operational risks.
In the wake of the crisis investors have made many more demands of hedge fund managers, and much has been written about the importance of infrastructure, but a recent move by Wells Fargo Advisors (WFA), recommending its clients redeem from the Frontier line of "hedge fund-like" mutual funds from Equinox Investment Management, may be one of the newer stories where investors are calling the bluffs of firms that have not maintained pace with industry wide trends to provide top risk management and infrastructure capabilities across the board.
According to an article by FinAlternatives, Wells Fargo Advisors spokesperson Tony Mattera said that the recommendation to redeem was due to issues that arose after the bank performed a comprehensive due diligence on the funds. In a letter sent to investors, WFA said it made recommendations to what it viewed were lapses including "inconsistent application and documentation of the stated investment due diligence process, potential ri...................... To view our full article Click here
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