Fortress Hedge-Fund Executives Lawin, Treacy Said to Have Left

Date: Thursday, March 25, 2010
Author: Bloomberg

Two Fortress Investment Group LLC hedge-fund executives have left the New York-based firm, according to two people with knowledge of the moves, after assets at their unit dropped 77 percent last year.

Scott Lawin, the former chief operating officer for Fortress’s Drawbridge Global Macro Funds, left in January to become COO at New York-based Moore Capital Management LLC, according to the people. Kevin Treacy, the unit’s chief financial officer, left two weeks ago, said the people, who declined to be named because the moves weren’t announced.

Fortress, run by former Fannie Mae chief Daniel Mudd, has struggled to restructure some of its biggest private-equity investments and halt outflows at its liquid hedge-funds business, where assets under management declined by 40 percent last year. Drawbridge, which is part of the liquid hedge funds, shrank 77 percent in 2009 to $1.43 billion, even as performance improved, Fortress said last month.

Lawin, who had joined Fortress in 2005, declined to comment on his departure. Treacy, who had been with the company since 2002, couldn’t be reached. Lilly Donohue, a spokeswoman for the firm, declined to comment.

Patrick Dennis, a former executive at Raptor Capital Management LP and Eton Park Capital Management LP, replaced Treacy last month, according to one of the people.

Michael E. Novogratz, one of Fortress’s five principals, runs the liquid hedge-fund businesses. The group encompasses the Fortress Macro Funds, raised last May, as well as the Fortress Commodity Funds and the Drawbridge products.

Liquid hedge funds focus on strategies that are the easiest to trade. Macro funds bet on economic trends.

Investment returns at the division improved last year as markets rebounded. The Drawbridge funds gained 24 percent and the Fortress Macro funds climbed 9.8 percent. Assets at Fortress Macro funds rose to $1.99 billion at the end of last year from $1.17 billion at the end of the second quarter.