The fund was closing, he said, near tears, to a group of portfolio managers over Zoom. Employees were floored.
George Weiss, 81, and chief investment officer Jordi Visser, 57, ran the $US2.3 billion firm with the glitz of larger multistrategy rivals, but without the discipline, the ruthlessness to cut losing traders or the ability to push more costs onto investors, according to the people and court filings.That proved fatal when Weiss’ biggest creditor demanded payment, later accusing George Weiss of using the firm as his “personal piggy bank”.
Rent for the 20th and 21st floor of its Park Avenue location alone totalled almost $US3 million a year, a bankruptcy filing shows. These so-called netting costs pose a huge risk for multistrategy funds. That’s why so many industry giants charge clients for traders’ pay, so they don’t have to foot the bill for bonuses during down years.
Leucadia granted Weiss forbearance agreements giving it more time to pay its debts on at least three occasions, and on December 21, the firm demanded payment. As Visser forged ahead with his multimedia efforts, the financial situation at his firm deteriorated and Leucadia asked for the ability to approve any staff bonuses. Weiss executives baulked.
Source: News Formal (newsformal.com)
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