Britain's Lord Myners urges UK to investigate GAM-Greensill fund
(Adds Myners comment)
By Tom Bergin and John Miller
LONDON/ZURICH, June 19 (Reuters) - A member of Britain's
House of Lords said on Wednesday that the UK financial regulator
should investigate the GAM Greensill Supply Chain Finance Fund
in relation to the pricing of investments and activities of its
Paul Myners, a former financial services minister, told
Reuters in an interview that he was concerned the regulator, the
Financial Conduct Authority (FCA), was not sufficiently alert to
the dangers of unlisted assets. These can boost funds' returns
but also carry hidden risks.
"The FCA needs to be looking at the processes followed by
GAM and the appropriateness of the investments for a fund that
was marketed as low risk," he said.
GAM, Greensill and the FCA declined to comment on Wednesday.
On June 10, Myners, who has held senior roles in the UK's
investment industry for decades, submitted a question to the
finance ministry regarding the fund.
He asked: "Her Majesty's Government whether they are
investigating, or intend to investigate, the management of,
investment valuations used by, and relationships between
managers and businesses invested in, the GAM Greensill Supply
Chain Finance Fund," according to the parliamentary website.
The GAM Greensill Supply Chain Finance fund is managed by
Zurich-based GAM Holding, with help from London-based
Greensill. It invests in short-term debts linked to companies'
expected payments from customers or payments due to suppliers.
GAM's share price has halved in the past year after the
suspension of its star fund manager, Tim Haywood, for what it
said was due diligence failures. Haywood has denied any
Reuters reported in April that Haywood's suspension followed
complaints from a whistleblower regarding his purchase of 550
million pounds ($691.85 million) worth of bonds issued by
Sanjeev Gupta's GFG Alliance, which were backed by diesel power
generators that have largely sat idle in recent years.
GFG Alliance declined to comment on Wednesday.
($1 = 0.7950 pounds)
(Reporting by John Miller in Zurich and Tom Bergin in London;
Editing by Michael Shields and Jane Merriman)
First Published: 2019-06-19 13:42:29
Updated 2019-06-19 19:14:44
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