BlueCrest Capital Management is under investigation by the US Securities and Exchange Commission (SEC) and other regulators.
The hedge fund said in a statement that it has received “a number of inquiries” since announcing its transition to a family office last December. BlueCrest is also returning $8 billion to its clients and said its “dialogue with regulators” will not affect this process.
“BlueCrest is fully cooperative with all of its regulators and to date has received no accusation of wrongdoing,” the firm added.
Bloomberg reported that the SEC was probing BlueCrest’s internal employee fund and possible conflicts of interest.
A spokesperson for the SEC declined to comment.
BlueCrest blamed its demise on the challenge of meeting individual needs of a large number of investors while earning high returns. The firm also named changing fee levels and cost of talent as reasons for closing.
“We will be stronger and more flexible under our new business model,” said Michael Platt, BlueCrest’s founder and chief executive in December 2015. “We have delivered industry-leading returns to our investors over the past 15 years but believe that BlueCrest is now better suited to a private investment partnership model.”
The London-based firm is expected to return 90% of client capital by the end of the first quarter of 2016.
Related: BlueCrest to Return $8B, Become Family Office & Hedge Fund Liquidations: Shakeout or Blip?