The Swiss asset manager settled a probe into its dealings with the now-defunct supply chain finance firm, sparked by a whistleblower more than four years ago.
Zurich-based GAM will pay the U.K. regulator £9.1 million ($12 million) to settle an investigation centered on an absolute-return line of bond funds, it said in a statement on Thursday. These were run by Tim Haywood (pictured below) until GAM suspended him in July 2018.
The Financial Conduct Authority, or FCA, investigated GAM's U.K.-based subsidiary over conflicts of interest related to three specific investments made by the absolute return bond funds, or ARBF. GAM didn't identify Greensill, GFG, or Sanjeev Gupta by name.
Cozy Greensill Ties
Separately, the FCA said it fined Haywood £230,037 for conflicts of interest and violating rules on gifts and entertainment, in a statement on Thursday. «The FCA considers that GAM International Management Ltd. failed to adequately control the conflicts of interest arising out of three specific investments,» it said.
Haywood flew on private planes owned by Gupta or Lex Greensill, founder-CEO of the eponymous firm, and enjoyed a concert at Buckingham Palace sponsored by Greensill, the «Financial Times» (behind paywall) reported in 2019. GAM fired Haywood later the same year.
Internal Whistleblower
A whistleblower within GAM first brought this and other issues to the Swiss firm's management in 2017, then eventually to the FCA the following year. The asset manager, which is still struggling to recover from its dealings with Greensill, said it isn't being investigated by any other regulator.
Haywood apologized for mistakes he said he had made and that he is looking «forward to returning to an active role in the industry and will make my plans public in due course. The whistleblower said they had taken note of the decision, and «hope that the FCA has ensured that all GAM clients who suffered detriment during this period have been made-whole.»
