Who is Crispin Odey, the hedge fund manager who is under the scanner for sexual misconduct allegations

Odey himself has rubbished the claims, telling Reuters that the investigation was “a rehash of  of an old article” and that “none of the allegations have been stood up in a courtroom”. He has also denied that any of the prime brokers are reconsidering their relationship with his company.

Who is Crispin Odey?

Born in 1959 in Yorkshire, England, Crispin Odey would go on to become one of the country’s most successful hedge fund managers and a prominent figure in the finance industry. He founded Odey Asset Management in 1991, which is one of the largest hedge funds in the United Kingdom.

Odey is recognised as a contrarian in the finance world, often making bold and controversial predictions about the markets. He made headlines for successfully predicting the 2008 financial crisis and profiting from it through short-selling. While his hedge fund primarily invests in equities, he has also made investments in commodities, currencies, and other asset classes.

Crispin Odey has also been a vocal critic of mainstream economic policies, chastising governments and economic institutions over excessive debt levels, inflation risks, and the impact of central bank interventions on global markets. He was also one of the biggest backers of Brexit.

However, in recent years, his hedge fund has faced significant losses, with Odey being criticised for his brash decision-making. He also underwent a highly publicised divorce case and has numerous allegations of sexual misconduct against him. As of September 2022, Odey’s firm oversaw about $ 5 billion in assets.

What are the allegations of sexual misconduct against Crispin Odey?

While Odey was cleared of indecent assault charges by a British court in 2021, the investigation by FT and Tortoise claimed 13 women have alleged that the hedge-fund manager assault of harassed them.

Of the them, eight were cases of sexual assault, including Odey masturbating on a female entrepreneur after a business meeting and forcing a friend’s hand on to his penis. These alleged incidents occurred between 1998 and 2022, with two incidents taking place after Odey’s acquittal in 2021.

In fact, the investigation found that when Odey Asset Management, of which Crispin Odey holds a roughly 75 per cent stake, tried to rein the him in, he fired the executive committee and evaded any accountability.

The investigation also raised questions about Odey’s associates, who continue to shield him from accountability and help in the rehabilitation of his image, including Kwasi Kwarteng, the former UK chancellor, worked for Odey before he went into politics. Kwarteng went to Odey’s house for a private lunch a few weeks before he was appointed chancellor and announced a mini-budget that generated huge profits for Odey’s funds.

What will the fallout of the allegations be?

These allegations are not new and over the years, other companies have turned a blind eye at them. However, within hours of the latest report being published, Wall Street firms including Goldman Sachs, JPMorgan and Morgan Stanley began reviewing their prime broking ties with Odey Asset Management.

Prime brokers lend hedge funds the money they need to facilitate investments. “If primes pull back, most firms would have to sell securities to pay back the ‘loans,’” George Evans, president of Convergence, a data and analytics firm that follows the alternative asset management industry, told Reuters. “Returns in a situation like this will potentially be impacted.” Evans called prime brokers the “lifeblood” of a hedge fund.

However, industry observers urge caution to those drawing any larger conclusions from the current situation. “At present time, this appears to be a problem for Odey, as opposed to some sort of watershed #MeToo moment set to engulf the broader British financial services industry”, Evan Nierman, CEO of New York-based crisis PR firm Red Banyan, told Reuters.

In finance, an industry in which women are under-represented in senior roles, more systemic changes are needed to address the toxic work culture and pervasive incidence of sexual misconduct, bullying, harassment and intimidation.

(With inputs from Reuters)