Hedge Fund Buying Claims From 1983 Terrorist Attack

Mar 24 2014 | 2:10pm ET

Iran is still a pariah in the international community, but one hedge fund thinks it will eventually pay $1.8 billion as ordered by a U.S. court.

RD Legal Capital hopes to raise up to $100 million to buy the rights to payments from families of the 241 U.S. Marines killed in a terrorist attack in Lebanon in 1983. A federal court in 2007 found Iran liable for the truck-bomb attack, which led to the withdrawal of U.S. troops from war-torn Lebanon.

Iran, of course, is not on the best of terms with the U.S., and the two countries do not have diplomatic relations. Still, Iran’s central bank is appealing the $1.8 billion verdict against it.

Victims’ families agreed to allow RD to buy stakes in the judgment. The firm will not buy out any of the beneficiaries, instead investing only in pieces of each of the 151 claims. The Iran fund is RD’s first ever focused on a single case, The Wall Street Journal reports.

It is unclear how much RD is paying for the stakes, although it generally buys claims for 18% to 24% below face value. It will charge investors a 30% performance fee—10 percentage points more than it usually levies.

RD is not financing the work of the law firms representing the families.


In Depth

Prominent Hedgie Renee Haugerud Embroiled in Ugly Child Custody Battle

Sep 10 2014 | 2:43pm ET

A high-profile hedge fund manager is caught up in a nasty child custody battle in...

Lifestyle

Full House’s Stamos To Play TV Hedge-Fund Manager

Sep 5 2014 | 4:43am ET

The life of a Connecticut hedge-fund billionaire is coming to the small screen.

Guest Contributor

The Cult of Loss Aversion: A Call to Rethink Risk in Global Macro Investing

Sep 4 2014 | 5:45am ET

In the wake of a traumatic loss, whether it is financial or personal, it is just...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

In search of the ‘new normal’ at the Fed

The Federal Reserve keeps baby-stepping toward a “normalization” of monetary policy. But just what is normal?

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.