Plainfield To Liquidate Hedge Funds, Return Assets

Mar 16 2011 | 12:20pm ET

Plainfield Asset Management, the embattled distressed debt hedge fund, is liquidating its hedge funds and will return all capital to investors by the middle of next year.

The firm has been hit with several whistleblower complaints accusing it of overvaluing assets and faces a pair of predatory lending probes. Last month, it struck a deal with private equity firm Paul Capital to unload a portfolio of illiquid debt positions for about $150 million, and two years ago it restructured its flagship to set up a liquidating share class. Assets under management have fallen since then from $3.6 billion to $1.1 billion.

Investors still with Connecticut-based Plainfield will get all of their money back by next June under its liquidation plan, HFMWeek reports. But despite the legal trouble—neither Plainfield nor founder Max Holmes have been formally accused of any wrongdoing—and the drastic move, the liquidation may not spell the end of the firm.

Plainfield's general partners are considering a plan to have the firm live on, and to launch a new fund managed by Holmes.

The firm also responded to the latest whistleblower complaint against it, asking the Securities and Exchange Commission to impose a trustee on the firm to oversee the wind-down of the fund.

"This is yet another in an unending series of anonymous complaints against Plainfield which have no merit," the firm's general counsel, Thomas Fritsch, told HFMWeek. "Under the Dodd-Frank Act, we have no opportunity to confront our accusers. For them to leak yet another letter to the press, while hiding behind several layers of anonymity, is an abuse of the law and demonstrates their malicious intent to harm our reputation."


In Depth

David Yarrow On Growing His Hedge Fund And Shooting The Animals And People Of Africa - As A Photographer

Jul 23 2014 | 6:44am ET

While he’s always been a photographer, recent expeditions to Iceland, Ethiopia...

Lifestyle

Einhorns Busts At WSOP, Finishes In 173rd

Jul 15 2014 | 10:48am ET

Greenlight Capital founder David Einhorn’s World Series of Poker won’t end at...

Guest Contributor

Common Risk Parity Misperceptions

Jul 16 2014 | 11:02am ET

Over the past few years, risk parity has become a component of most investors’...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note