Under-fire fund manager GAM sheds chief executive Alexander Friedman

THE crisis enveloping Swiss fund manager GAM Holding deepened today as chief executive Alexander Friedman paid the price for the firm’s recent woes with his job.

GAM has been under intense pressure since one of its star fund managers, London-based Tim Haywood, was suspended in July during a misconduct investigation over record keeping and risk management.

That prompted a Swfr17.7 billion (£13.5 billion) hit in the third quarter as Haywood’s suspension prompted it to return the billions in his funds to investors, while slumping markets exacerbated the exodus.

Haywood is still employed by the company while the investigation continues.

GAM has not revealed the settlement to Friedman, who has led the business since 2014 and steps down immediately. He was paid Swfr4.35 million last year, when the firm was also forced to change its pay policy in the teeth of an investor revolt. Shareholders have also been licking their wounds after a 60% fall in the share price over the past year, as well as a profit warning over a recent acquisition of a UK hedge fund.

Predators have been lurking as a result with reports that it rebuffed an offer from Schroders for its hedge fund unit.

Board member David Jacob will become interim group chief executive while GAM hunts for a replacement. Chairman Hugh Scott-Barrett praised Friedman’s “significant efforts” and said he had the full support of the board in the decision to suspend Haywood.