Wednesday, 30 July 2014
Last updated 4 hours ago
Apr 18 2008 | 3:03am ET
Och-Ziff Capital Management Group said it has been ensnared in a Japanese fraud.
The Wall Street Journal reports that the New York-based hedge fund lost about US$77 million in the scheme, which also caught Lehman Brothers. Och-Ziff said that the loss has already been written off and was reflected in the newly-public firm’s most recent results statement.
The fraud allegedly involved employees of Japanese trading firm Marubeni Corp., and began in November. Those Marubeni staffers seem to have used the firm’s offices, computers and letterheads to raise phony bridge loans for Japanese hospitals to buy new medical equipment. A Hong Kong-based Och-Ziff affiliate made the loans, the firm said.
Lehman Brothers last month field suit in Tokyo seeking to retrieve its US$344 million. It names Marubeni as a defendant, though the trading firm denies any involvement and said that Lehman should have been “suspicious” about the allegedly phony documents.
“The investment, which has not yet been recovered, is not material to any of Och-Ziff’s funds or to its publicly-traded holding company,” Och-Ziff said in a statement. “The firm is currently pursuing all avenues to recover its investment.
Och-Ziff, one of the largest hedge fund managers in the world with more than $32 billion in assets under management, went public in November.
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…