Structural Due Diligence, Operational Risks, and the Evaluation of Managed Account Platforms

2021 ◽  
pp. jai.2021.1.149
Author(s):  
Ranjan Bhaduri
Keyword(s):  
Due Diligence ◽  
Operational Risks

Hedge Fund Due Diligence

2017 ◽  
Author(s):  
Jason Scharfman
Keyword(s):  
Risk Mitigation ◽  
Hedge Fund ◽  
Due Diligence ◽  
Technology Infrastructure ◽  
Information Technology Infrastructure ◽  
Operational Risks ◽  
Continuity Planning ◽  
The Board Of Directors ◽  
Operational Failures ◽  
Back Office

This chapter provides an overview of hedge fund due diligence challenges facing investors with a specific focus on the operational due diligence process. Operational due diligence is the process of evaluating the operational risks in place at a hedge fund. In recent years, due to a series of hedge fund failures and frauds, operational risks have become increasingly important. Risk mitigation techniques include information technology infrastructure; evaluations by the board of directors; business continuity planning; hedge fund service provider assessment, valuation, and fund operations; and back-office procedures. Another component of the operational due diligence process involves performing background investigations on key personnel. By seeking to evaluate these types of operational risk, investors can better diagnose and avoid losses from these hedge fund operational failures and outright fraud.

A hedge fund collapse and diversification 101: lessons to stakeholders

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Majed R. Muhtaseb
Keyword(s):  
Hedge Funds ◽  
Stock Price ◽  
Hedge Fund ◽  
Securities And Exchange Commission ◽  
Fiduciary Duty ◽  
Due Diligence ◽  
Content Type ◽  
The Public ◽  
Operational Risks ◽  
Fund Industry

Purpose The purpose of this paper is events and analysis of present a hedge fund collapse, offer lessons to investors and hedge fund industry stakeholders and propose a possible remedy for mitigating operational risks and associated potential losses. Design/methodology/approach This study focused on one hedge fund case study and conducted a thorough investigation of the events that led to the collapse and eventual filing of the Securities and Exchange Commission (SEC) complaint. All articles and publications used for this research are available in the public domain and accessible. Findings Wood River Capital Management had concentrated the portfolios of its two hedge funds into one stock, EndWave Corp. Fund Manager violated terms of offering memorandum. Investors were not made aware of and did not discover the operational risks. Stock price of EndWave plummeted. There was no independent oversight over the funds. The values of the two funds dropped significantly. Investors attempted to redeem but the funds were not liquid. The SEC filed a complaint. Mr Whittier was sentenced for three years in jail. Research limitations/implications It is an analysis of US-based hedge fund, not an empirical paper. The article presents critical analysis and offers many valuable lessons to hedge fund industry stakeholders. Practical implications This paper helps investors in terms of identifying a hedge fund’s operational risks and conducting more effective due diligence while vetting a hedge fund. This could potentially save investors and constituents billions of dollars, by avoiding potential hedge fund collapses. This paper suggests that the scope of fiduciary duty be expanded to cover hedge fund industry vendors. Originality/value Thorough research of a hedge fund that collapsed because of poor investment decisions, not self-enrichment at expense of fund investors. This paper provides lessons to investors in terms of identifying a hedge fund’s critical operational risks and conducting value preserving due diligence. This could potentially save hedge funds investors billions of dollars, by avoiding potential hedge fund collapses. This paper recommends that the scope of fiduciary duty be expanded to cover hedge fund industry vendors.

Diligentia quam in suis as a Technique for a Contextual Application of the Full Protection and Security Standard: Considering the Level of Development of Host States in International Investment Law

2020 ◽  
Vol 28 (4) ◽  
pp. 596-611
Author(s):  
Nitish Monebhurrun
Keyword(s):  
International Law ◽  
International Investment ◽  
Due Diligence ◽  
Foreign Investors ◽  
International Investment Law ◽  
Local Means ◽  
Security Standard ◽  
Maximum Protection ◽  
Investment Law ◽  
Full Protection

With international investment law as the background to this study, the present article examines how the full protection and security standard can be construed from the perspective of developing states hosting foreign investments. The research delves into classical public international law to argue that the diligentia quam in suis rule can be used as a means of interpretation to strike a balance between foreign investors’ and developing states’ interests when construing the full protection and security standard. The rule provides that any expected due diligence from the state party is necessarily of a subjective nature. This means that developing host states must deploy their best efforts to offer maximum protection to foreign investors not on an in abstracto basis but as per their local means and capacity. Accordingly, the standard is presented as an adaptable and flexible one which moulds its contours as per the level of development of the host state. Such flexibility does not imply condoning states’ abuse and negligence. The article explains how the diligentia quam in suis rule enables a conciliation between the full protection and security standard and the host state's level of development while rationalising the standard's application to developing nations.

HR Due Diligence

2012 ◽  
Author(s):  
ChyeKok Ho ◽  
Chin Seng Koh
Keyword(s):  
Due Diligence

Vendor Due Diligence

2005 ◽  
Vol 34 (10) ◽  
pp. 548-553
Author(s):  
Sebastian Friese ◽  
Thomas Mittendorf ◽  
J.-Matthias Graf von der Schulenburg
Keyword(s):  
Due Diligence

RJC Due Diligence Member Toolkit

2020 ◽  
Vol 37 (3) ◽  
pp. 230-230
Author(s):  
Carol M. Stockton
Keyword(s):  
Due Diligence

DEKADENSI PEMILIHAN HAKIM AGUNG OLEH DPR RI

2020 ◽  
Vol 14 (1) ◽  
pp. 73-104
Author(s):  
Rustam Magun Pikahulan
Keyword(s):  
Supreme Court ◽  
Rule Of Law ◽  
House Of Representatives ◽  
Good Governance ◽  
Constitutional Court ◽  
Due Diligence ◽  
The Rule Of Law ◽  
The Supreme Court ◽  
Institutional Status ◽  
The Government

Abstract: The Plato's conception of the rule of law states that good governance is based on good law. The organization also spreads to the world of Supreme Court justices, the election caused a decadence to the institutional status of the House of Representatives as a people's representative in the government whose implementation was not in line with the decision of the Constitutional Court. Based on the decision of the Constitutional Court No.27/PUU-XI/2013 explains that the House of Representatives no longer has the authority to conduct due diligence and suitability (elect) to prospective Supreme Judges proposed by the Judicial Commission. The House of Representatives can only approve or disapprove candidates for Supreme Court Justices that have been submitted by the Judicial Commission. In addition, the proportion of proposed Supreme Court Justices from the judicial commission to the House of Representatives (DPR) has changed, whereas previously the Judicial Commission had to propose 3 (three) of each vacancy for the Justices, now it is only one of each vacant for Supreme Court Judges. by the Supreme Court. The House of Representatives no longer has the authority to conduct due diligence and suitability (elect) to prospective Supreme Judges proposed by the Judicial Commission. The House of Representatives can only "approve" or "disagree" the Supreme Judge candidates nominated by the Judicial Commission.

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