Integro, Amber Partners introduce hedge fund investor cover

Integro, the complex risk insurance broker, and Amber Partners (Bermuda), the hedge fund operational due diligence firm, have introduced insurance coverage designed to protect sophisticated investors from hedge fund losses due to fraud, allegations of fraud and other such malfeasance.

The policies of Hedge Shield, which is underwritten by several insurance carriers, which will cover hedge fund investors against potential losses and reputational damage resulting from a seizure of assets by a governmental or regulatory agency due to actual or alleged fraudulent activity.

"Given the nature of a sudden collapse, Hedge Shield provides prompt recovery of the policyholder’s interest in a hedge fund position within 90 days of a seizure. Investors also benefit from Amber Partners’ world class due diligence expertise conducted as part of the underwriting process," the companies said in a joint statement, adding that "Amber Partners’ Management has collectively reviewed approximately 700 hedge fund operations."

“Hedge Shield fills a vital need for institutional hedge fund investors,” affirms Integro CEO Roger Egan. “Nearly 85% of hedge fund ‘meltdowns’ over the past ten years have had elements of operational weakness which could invite fraud. Seizures resulting from the majority of those failures would have triggered this new offering, sparing investors a significant impact to their portfolio and reputation through immediate recovery of assets.”

“Amber Partners is pleased to assist underwriters for Hedge Shield,” said Reiko Nahum, CEO of Amber Partners. “Our due diligence for Hedge Shield is specifically focused on four primary areas where the potential for fraud typically exists: overstatement of net asset values, theft of fund assets, concealment of trades, and false claims as to assets which the fund does not have title.”