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Gam whistleblower triggered Haywood probe

CEO Alexander Friedman says group will protect employee who blew the lid off star manager’s conduct issues


Kristen McGachey

Gam has disclosed that the suspension of one of its star managers Tim Haywood (pictured) was triggered by concerns raised by an internal whistleblower last year.

The Swiss fund group said it took the concerns brought by the unnamed employee “very seriously” and had ensured the existence and identity of the whistleblower remained protected.

An internal investigation into Haywood’s conduct was launched in November 2017 on the back of the whistleblower’s concerns, Gam revealed in a press statement. By March 2018 the whistleblower expanded on their initial concerns and got the Financial Conduct Authority involved, while keeping Gam informed.

Haywood was ultimately suspended for conduct issues, which concerned his due diligence and record keeping “in certain instances”. The investigation also found that Haywood may have breached Gam’s signatory policy and gifts and entertainment policy and may have used his personal email for work purposes.

Gam reiterated on Tuesday that no other employees were being investigated in connection with Haywood’s suspension.

Haywood’s fate is still being decided.

Whistleblower protection essential

The fund group said it would continue to provide “all appropriate protections” to the Haywood’s whistle-blowing colleague.

“At the heart of every modern financial services firm’s systems and controls should be a culture that encourages people to come forward with concerns about colleagues’ behaviour,” Gam CEO Alexander Friedman said in a statement.

“The only way to maintain that culture is to protect those who are brave enough to do so and to hold accountable those found to be breaking the rules. This is central to trusted client relationships and we will never compromise on this point. I’m grateful to every one of our clients that has taken the time to understand our approach to these issues and we continue to work tirelessly in their best interests.”

Haywood’s suspension in July took the market by surprise, triggering a wave of redemptions from the CHF 11bn (€9.5bn) ARBF range prompting Gam to freeze trading. A week later Gam decided to liquidate the range as its share price continued to decline. Shares in the asset manager are down over 50% year-to-date.

Gam said the wind-up of Haywood’s ARBF range is “progressing as planned” and is being done in a way that “ensures all investors are being treated fairly and equally”. It has returned between 60% and 87% of funds to date and will be launching a second round of liquidation payments this week.

The Swiss fund group is still claiming that “no material client detriment” has been suffered as a result of Haywood’s conduct and said it continues to keep this under review.

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