Back in September 2011 we noticed the curious decision of the Serious Fraud Office to drop its investigation into Weavering Capital, the investment advisor to the failed Weavering Macro Income Fund (a Cayman Islands hedge fund). The SFO’s dropping of its investigation was thrown into relief when the Cayman Grand Court found two of the Fund’s directors, Stefan Peterson and Hans Ekstrom, guilty of wilful negligence and awarded damages against them of $111 million in a case brought by the Fund’s liquidators.
Today the High Court in London found Magnus Peterson, the founder of the Fund (and brother of Stefan, stepson of Hans) to have committed fraud and breached his duty of care and so liable for deceit in a civil case brought by the Fund’s liquidators.
Magnus Peterson, who was found liable with three other defendants (including his wife – this was a family affair) continues to deny wrongdoing.
Weavering was one of London’s oldest hedge funds; after it collapsed it emerged that its main asset was $637 million in swaps with an offshore company controlled by Magnus Peterson.
The case has some parallels with the FSA’s action, announced yesterday, against hedge fund manager Alberto Micalizzi, where the Serious Fraud Office also found insufficient evidence of wrongdoing to pursue a criminal case following another high-profile hedge fund collapse.
UPDATE 8 July 2012: SFO re-opens investigation into collapse of Weavering hedge fund