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Hedge Fund New Stream has massive Layoffs after Pot Farm Bust


Date: Friday, October 8, 2010
Author: Teri Buhl, HedgeTracker

New Stream Capital has been forced to layoff most of their staff after mega fund of fund Gottex took receivership of some of their assets and is forcing a liquidation. DealFlow media was first to report the news and says the New Stream managers are fighting to hand over court ordered assets to its Bermuda investors. New Stream at its peak in 2008 was a $1 billion asset backed lending fund, headquartered in Ridgefield Conn., who ran U.S. and off-shore funds for institutional investors. Fund managers are still charging investors management fees, off total assets, while they hang on for control of the assets.

Last month the hedge fund's founder David Bryson learned his head of investor relations was arrested for running a pot farm out of her million dollar Newtown,Connecticut home. Tara Bryson, David's sister, was key to communicating how the fund was managing it's illiquid assets that have been gated since May 2009. New Stream said Tara has been suspended after they read news reports about her arrest but won't answer if she's was part of the layoffs.

The issue for U.S. investors, who did not sue for receivership of funds, is will there be any money left after the Bermuda investors liquidate assets to get back their initial investments. U.S. investor even included the pension fund of McKinsey & Co who has over $50 million invested in New Stream. Dealflow Media reported at the end of 2009 total firm assets were $647.8 million and the Bermuda investors are owed $444 million.