Sunday, 29 March 2015
Last updated 1 day ago
Mar 1 2012 | 12:00pm ET
The U.K.'s highest court has ruled that all Lehman Brothers clients can share in a pool of the bankrupt investment bank's segregated client assets, a victory for some hedge funds and a stinging defeat for others.
The U.K. Supreme Court ruled Lehman customers, including prime brokerage clients, can share in the US$2 billion pool, and not just those clients whose capital was properly segregated. Judge John Dyson wrote that "all client money is subject to a trust that arises upon receipt of the money by the firm," making it irrelevant whether Lehman properly ring-fenced a client's money or not.
Dyson admitted that, under his ruling, the Lehman collapse created a "cataclysmic shift of beneficial ownership." But all clients must equally share in the misfortune if the wrongdoing was the fault of the firm, he said.
The ruling is a major victory for hedge fund CRC Credit, as well as for Lehman's U.S. and Swiss businesses. On the other hand, it’s a tough defeat for GLG Partners, which argued the case of clients whose money was properly segregated, and the receiver for Lehman Brothers International (Europe), where the client money was actually housed.
GLG's lawyer, Jennifer Marshall, warned that the ruling would have a chilling effect on British investment firms and investors, citing one of the Supreme Court's dissenting judges. Judge Robert Walker wrote that the decision "makes investment banking more of a lottery than even its fiercest critics have supposed."
Mar 9 2015 | 6:35am ET
As more investors look to diversify, many are beginning to use retirement funds to invest in alternative assets such as private equity and real estate. Kelly Rodriques, CEO & President of PENSCO Trust Company, explains how companies can connect with those looking to use their retirement accounts in a different way. Read more…
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…