Sunday, 24 May 2015
Last updated 1 day ago
Jul 8 2010 | 2:30pm ET
The liquidators of a collapsed Carlyle Group mortgage-bond hedge fund have filed a pair of lawsuits against the private equity giant, accusing it “recklessly” investing the $945 million vehicle.
Carlyle Capital Corp. missed more than $400 million in margin calls and collapsed after its lenders seized all of its assets in 2008, just months after it launched. According to the lawsuits, filed in Delaware and New York, Carlyle did nothing to prevent the fund’s problems and used more than 50% more leverage than its business model called for.
“CCC’s losses were the direct result of a determinedly reckless ‘bet the farm’ approach, brazenly pursued in the self-interests of the Carlyle Group,” the Delaware lawsuit alleges.
“In the short space of eight months, the entirety of CCC’s capital was spectacularly lost under the reckless and grossly negligent direction, supervision, management and advice of the defendants.”
Carlyle vowed to “vigorously contest all claims,” and noted that Carlyle and its employees lost more than $230 million in the fund.
According to joint liquidators Alan Roberts and Neil Mather of Begbies Traynor, CCC employed 30-times leverage, when the business planned called for 19-times. The liquidators, which say Carlyle earned $17.2 million in fees managing the fund, are seeking more than $1 billion.
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…