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Magnus Peterson By Beverly Chandler, Opalesque London:

The decision by the British Serious Fraud Office that it has dropped its investigation into the collapse of Weavering Capital (UK) Ltd, a London-based hedge fund managed by Magnus Peterson, which went into liquidation in early 2009, leaving investors nursing losses of over $500 million, has raised a number of comments around the hedge fund industry.

Jerome Lussan, CEO of Laven Partners commented: "The fact that the SFO is dropping its investigation against Weavering is terribly bad news for investors. From a legal point of view this reflects the concern of all investors in that there is simply no accountability for UK based managers who abuse of their rights. The structure of hedge funds is such that the liability is too remote for key principals who protect themselves through intelligent legal structures. This is proven again and again. "

Lussan believes that the only solution for investors, based on the traditional caveat emptor principle, is for them to watch out for themselves and do their own due diligence in full. "We need to keep investors aware that this is their risk. Hedge funds are as a whole very beneficial to our lives, but investors need to understand that the risks are on them alone regardless of who is providing a service to the hedge fund. The standards of due diligence have to change as no governments are going to bail out hedge fund inv......................

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