
The investigations into Odey Asset Management and its founder, Crispin Odey, which are currently capturing the headlines in the financial press, tell a familiar story of how fast a financial institution can fall from grace when disaster strikes. Institutional investors (and by extension some retail funds that had been invested in Odey’s strategies) have already caused the suspension of five Odey managed funds. The pattern that we saw in the wake of the Woodford saga of investors fleeing the sinking ship is very familiar, with suspensions of redemptions and finger pointing at the FCA.
Unlike in the Woodford case, the allegations which have precipitated the collapse of the Odey business are concerned with the conduct of a single individual, rather than under-performance. Although the financial sector is far from immune from claims of sexual harassment, the solution for investors has been to disassociate themselves with the alleged behaviour as fast as possible. Getting one’s money back aside, the saga raises some interesting questions about investor rights in such a situation.