The movement of cash and assets from Odey Asset Management in the UK has been restricted by the Financial Conduct Authority (FCA) in an effort to restore order within the hedge fund following allegations of sexual impropriety against its founder, Crispin Odey.
According to sources familiar with the situation, the FCA will disclose voluntary restrictions agreed with Odey Asset Management on Monday. These restrictions, which also apply to associated firm Odey Wealth Management, will require both entities to preserve cash and assets for their regular operations.
One source stated that the FCA will require preapproval for transactions above a certain threshold, except in the normal course of business.
The FCA, Odey Asset Management, and Odey Wealth Management declined to comment on the matter.
It is common for regulators to impose restrictions on firms experiencing difficulties to ensure the orderly continuation of their operations, as per a source familiar with the regulator’s protocols.
These actions come amidst a tumultuous period for Crispin Odey’s businesses, as he faced allegations of sexual assault or harassment by 13 women in an investigation conducted by the FT. Odey has strongly denied these allegations.
Odey Asset Management, which previously managed $4.4bn, informed investors last week about its plans to shed some of its funds, personnel, and infrastructure. Despite Odey’s removal by other partners, the firm continues to face challenges.
As of now, four of Odey Asset Management’s funds have been suspended, with the most recent suspension occurring on Friday due to a significant volume of withdrawal requests.
After it was revealed that the FCA had been investigating Odey for over two years, the regulator has faced scrutiny. The House of Commons Treasury select committee has written to the FCA, demanding an explanation regarding its handling of the situation.
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