Dominique Strauss-Kahn return to finance clouded by death of business partner Thierry Leyne

Leyne was accused of making "unauthorised deals" by Swiss hedge fund before his death in apparent suicide

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The return of Dominique Strauss-Kahn to finance has come under renewed scrutiny after it emerged his late business partner Thierry Leyne had been embroiled in a dispute with a Swiss investor before his death in an apparent suicide last week.

Leyne, chief executive and co-owner of Leyne, Strauss-Kahn Partners, fell to his death from a Tel Aviv building on 23 October.

Just three days before his tragic death, Mr Strauss-Kahn announced he would be stepping down as chairman of LSK & Partners  "to dedicate himself to other activities".

The former head of the International Monetary fund had acquired a 20 per cent in the firm last year in an effort to rebuild his career.

Mr Strauss-Kahn resigned as managing director of the International Monetary Fund in an embarrassing episode after he was accused of raping a hotel maid in 2011.

 

Now it has emerged his late business partner was in dispute with a Swiss hedge fund which accused him of making unauthorised trades with its money.

Insch Capital Management made a formal complaint to Swiss regulators claiming that LSK & Partners made "totally unauthorised purchases" of shares in Firstcaution, an insurer of which LSK & Partners owned a majority stake.

Insch claims LSK used $400,000 from the firm's funds deposited in VP Bank- a private bank headquartered in the Principality of Liechtenstein- to buy shares in Firstcaution.

Insch's chief executive, Christopher Cruden, told The Independent neither his firm nor clients lost money after Mr Leyne agreed to refund the money.

In a separate development, LSK's fund management arm, Assya, was granted a suspension of debt payments in a Luxembourg court on Thursday as it seeks to win protection against creditors, including Swiss insurance group Baloise, which recently sued the firm for two million euros.

Shares in LSK & Partners were suspended last week and have lost more than half of its market value.

Mr Strauss-Kahn's stake was worth 20 million euros when he joined the firm last year. LSK & Partners has taken its website down and could not be reached for comment.

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