Thursday, 31 July 2014
Last updated 14 hours ago
Mar 2 2009 | 10:59am ET
Hedge funds don’t usually concern themselves with existential questions, but in the wake of the Bernard Madoff scandal and a slew of smaller alleged frauds, D.E. Shaw Group is doing just that.
The New York-based firm says it will appoint independent administrators for its funds, and that one of their jobs will be to ensure that its investments actually exist, the Financial Times reports. Investors, especially of the institutional variety, have clamored for U.S.-based hedge funds to hire independent administrators in the wake of Madoff’s arrest, with some threatening to pull their money from firms that fail to do so.
“Up until recently, valuation was the issue investors in alternatives were most focused on,” D.E. Shaw spokesman Darcy Bradbury told the FT. “Now, we’re going beyond that and looking at third-party administration arrangements where an administrator would also substantiate positions and cash balances.”
The court-appointed receiver for Madoff’s firm said recently that is appears that Madoff, accused of defrauding investors of $50 billion, never invested a dime in what authorities call the largest Ponzi scheme in history.
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…