Tags: Och-Ziff | hedge fund | bribery | Africa

Och-Ziff Rallies as Hedge Fund May Be Spared in Bribery Probe

Och-Ziff Rallies as Hedge Fund May Be Spared in Bribery Probe

(Stock Photo Secrets)

Wednesday, 17 August 2016 02:57 PM

Shares of Och-Ziff Capital Management Group LLC, which is under investigation by U.S. authorities for bribery, rose on news that the hedge fund firm’s main business may avoid conviction in the probe.

The New York investment firm, which is led by Daniel Och, has been in the crosshairs of investigators for at least five years over whether it knowingly paid bribes to government officials in the Democratic Republic of Congo and Libyan officials. Prosecutors are discussing an arrangement with the money manager that would have an overseas unit plead guilty, while still requiring the holding company to enter a deferred-prosecution agreement, people with knowledge of the matter told Bloomberg Tuesday.

Och-Ziff rose as much as 8.1 percent, the most in two weeks, and was up 2.2 percent at 9:50 a.m. in New York.

Och-Ziff has suffered a wave of redemptions as the probe comes to a head. The legal woes, decline in assets, and the mediocre performance in the firm’s main multistrategy hedge fund have taken a toll on the company’s stock, which has fallen about 66 percent in the past year.

“Of the best, base, and worst case outcomes for the investigation, we view a deferred prosecution agreement as a best case outcome” because charges are dismissed after a period of time if a company remains compliant, Amy DeBone, an analyst at Compass Point Research & Trading, wrote in a report Wednesday.

Och-Ziff said earlier this month that it earmarked $414.3 million to resolve the investigation and is in talks to raise capital from partners to help cover the cost. Chief Financial Officer Joel Frank said on a conference call at the time that talks with the government are in advanced stages and that he doesn’t expect the final settlement amount to exceed the reserve.

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Shares of Och-Ziff Capital Management Group LLC, which is under investigation by U.S. authorities for bribery, rose on news that the hedge fund firm's main business may avoid conviction in the probe.
Och-Ziff, hedge fund, bribery, Africa
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2016-57-17
Wednesday, 17 August 2016 02:57 PM
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