FrontPoint Partners’ investors get spooked by insider trading investigation, withdraw billions

December 1st, 2010
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FrontPoint Partners, the $7 billion hedge fund manager that was recently named in an insider trading investigation, has begun to face the heat from investors worried about the legal implications. In November, a French doctor was arrested for the alleged sharing of confidential clinical drug trial information with FrontPoint, preventing the firm’s $1.2 billion healthcare fund from losing $30 million. According to Financial Times, FrontPoint’s investors, spooked by the allegations made against the hedge fund, are reportedly attempting to withdraw $3 billion from the firm.

FrontPoint has begun to close down the hedge fund in question, and informed investors that 97% of the fund’s November 19 net asset value will be returned to them.

FrontPoint Partners LLC is a multi-strategy hedge fund management firm that was founded in 2000. Until 2010, the firm was a subsidiary of Morgan Stanley Investment Management (MSIM), which acquired the firm in November of 2006. FrontPoint is now led by Co-CEOs Dan Waters and Mike Kelly, who purchased a controlling stake in FrontPoint in 2010 from Morgan Stanley.
For Detailed Investor Profiles on these Investors, click below:
FrontPoint Partners
Related People: Daniel Waters; Gil Caffray*; James G. Webb; Michael John Kelly; Paul Ghaffari*; Philip Duff*
Related Entities: FrontPoint Consumer and Industrials; FrontPoint Financial Services; FrontPoint Healthcare; FrontPoint Quantitative Macro; FrontPoint Volatility Opportunities; Morgan Stanley Investment Management
Related Article Tags: Hedge Fund Fraud and Ponzi Scheme News

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