Man crisis after arrest and cash leak

The scale of the crisis facing Man Group's new boss was laid bare as clients pulled billions more from its funds and an employee was arrested for insider dealing.

The troubled hedge fund said it had suspended a worker in the GLG unit it bought for $1.6bn (£1bn) in 2010.

The employee – who is believed to be Carl Esprey, a portfolio manager – was arrested on suspicion of insider dealing and market abuse.

The company said that it was "co-operating fully" with the Financial Services Authority (FSA) but would not comment on the identity of the individual.

"Man has been informed by the FSA that the investigation concerns the individual's actions as a private individual and not as an employee of Man or GLG," it added in a statement.

The news overshadowed Man's first set of full-year results under new chief executive Manny Roman where the company reported a £745m loss compared to a £193m profit in 2011.

Man said clients had pulled out $2.7bn in the final quarter of 2012, meaning the group has now had net customer outflows in every quarter over the past four years, apart from during the first half of 2011.

"Last year was another tough year for Man," Mr Roman said.

"Trading conditions were highly challenging as markets continued to be dominated by political uncertainties in Europe and the US and macroeconomic risks. Investor appetite remained muted, and, as expected, there was a further decline in Man's product margin mix and revenues," he added.

The group has also written down the value of its GLG acquisition by a further $746m.

GLG, which was founded as a division of Lehman Brothers in 1995, was meant to diversify the group away from its computer-driven AHL fund but has so far failed to bear fruit.

Mr Roman warned that Man's outlook remained challenging.

"The number of requests for proposals and the pipeline of new mandates have increased to a degree. However, given the lead time required by institutional investors to invest, gross sales are likely to remain muted in the first half and we are yet to see a slowdown in the rate of redemptions," he said.

Man said it expected to make $100m in cost savings by the end of the year. The group has already made a number of management changes.

"We have introduced changes to senior management to further enhance Man's focus on investment performance. We will maintain our efforts to make Man lean and efficient," Mr Roman said.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Louis Theroux: By Reason of Insanity takes him behind the bars again
tvBy Reason of Insanity, TV review
Arts and Entertainment
Cassetteboy's latest video is called Emperor's New Clothes rap
videoThe political parody genius duo strike again with new video
Sport
Seth Rollins cashes in his Money in the Bank contract to win the WWE World Heavyweight Championship
WWERollins win the WWE World Heavyweight title in one of the greatest WrestleMania's ever seen
News
news
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Recruitment Genius: Annuities / Pensions Administrator

Negotiable: Recruitment Genius: You will be the first point of contact for all...

Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

Ashdown Group: Learning and Development Programme Manager

£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...

Day In a Page

No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

Spells like teen spirit

A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

If fashion is a cycle, this young man knows just how to ride it

British designer Jonathan Anderson is putting his stamp on venerable house Loewe
Number plates scheme could provide a licence to offend in the land of the free

Licence to offend in the land of the free

Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

From farm to fork in Cornwall

One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

Robert Parker interview

The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
Don't believe the stereotype - or should you?

Don't believe the stereotype - or should you?

We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor