Malachite Capital LP Being Investigated for Investment Losses
Malachite Capital Partners LP is currently being investigated for possible fraud or breach of fiduciary duty to investors. At Meyer Wilson, we have extensive experience handling these cases and are ready to help investors who have suffered losses after investing in Malachite Capital Partners LP.
What is Happening With Malachite LP & Investment Loss Claims?
Malachite Capital Partners LP is under investigation based on allegations of breach of fiduciary duty and possible fraud of investors. We know that Malachite was channeled endowment and foundation money through Fund Evaluation Group.
Fund Evaluation Group is responsible for advising or directly operating portfolios of many universities, charities, and other institutions. Malachite is based in New York and oversees around $600 in investments. Malachite recently announced plans to dissolve its fund due to adverse market conditions.
This firm was founded by former Goldman Sachs traders Joe Aitken and Jacob Weinig. They recently told Bloomberg News that, “[d]ue to the extreme adverse market conditions of recent weeks and the resultant funds’ performance, the current and projected assets will not justify or support the current structure of the funds. It is in the best interest of the funds and their investors to dissolve the funds immediately pursuant to their governing documents in order to commence an orderly wind-down.”
Who Does Malachite Represent?
Malachite represents various educational organizations and charities, along with other institutions. Fund Evaluation Group consultants allegedly recommended Malachite as a suitable firm for investments as recently as late 2019. This includes Utah’s public education trust, the University of Toledo Foundation, and the University of Illinois.
At the end of 2019, Malachite represented 5.6% of a pool of hedge fund investments that Fund Evaluation Group built for their clients (in a fund-of-funds). This is called the “FEG Absolute Access Fund,” and is one of several vehicles that the firm uses to channel money from institutions whose portfolios the firm is responsible for.
As we have previously stated at Meyer Wilson, hedge funds are known for underperforming or shutting down entirely. Recent volatility in the stock market has led many industry experts to indicate that hedge fund dissolutions could become inevitable.
In a brochure used by Malachite in 2019, the firm stated that it “seeks to capture short-term volatility risk premium within the global equity markets while diligently monitoring risk and adhering to a strict risk management process.” Unfortunately, it seems that when stock prices dropped significantly, and market volatility peaked, Malachite did not take steps to protect investors.
If you believe you have been misled or have suffered losses after working with Malachite Capital Partners LP, contact Meyer Wilson today. You can contact us by calling (888) 390-6491 or contact us online to speak confidentially with an attorney today. At this point, the investigation into Malachite is ongoing, and it is not clear right now whether there are any investor funds left at all. Not only will we keep a close eye on this investigation, but we will also monitor whether or not Fund Evaluation Group becomes involved in any investigations.