Earlier this year, Crispin Odey joined colleagues at Grosvenor House in Mayfair for “the hedge-fund world’s equivalent of the Oscars”, says the Financial Times. Odey Asset Management won “firm of the year”.
Few of those celebrating the win at the black-tie gala would have guessed that, within months, the £3bn asset manager would all but cease to exist.
Felled by a sex scandal, the firm is set to break itself up and Odey faces a possible rash of legal action over allegations of sexual misconduct.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
At least two of the 13 women he is alleged to have assaulted are pursuing civil claims. Odey has denied any wrongdoing.
The Financial Conduct Authority is also investigating whether Odey is a “fit and proper” individual to work in financial services over allegations he breached integrity rules in dismissing the executive committee of his firm in 2021 for “an improper purpose”.
“Crispin Odious”
As banks and other institutions rushed to cut ties, one stockbroker told clients that Crispin Odey has become “Crispin Odious”, according to The Times.
Renowned for making £220m in a day in 2016 by betting markets would fall sharply after a Leave vote, Odey was already, to many, the face of all that was unacceptable about the City.
An arch-Brexiteer, the Old Harrovian was accused by Remainers of gloating over the referendum result. “Il mattino ha l’oro in bocca – the morning has gold in its mouth,” he told an interviewer on Brexit morning.
Still more insidious, says Byline Times, were Odey’s close links with Tory politicians. Cultivating friendships with Boris Johnson among others, he was one of the most influential hedge-fund donors in UK politics.
Last September when the ex-chancellor Kwasi Kwarteng (a former protégé at Odey Asset Management) presented his ill-fated “mini-budget”, it was reported that Kwarteng enjoyed a “budget day cocktail party” with financiers, including hedge-fund managers who stood to from the crash caused by his policies.
Odey was noticeably absent – true to form, he was away grouse shooting on the fateful day, says the Daily Mail – but still made millions from bets against UK gilts and the pound, claiming he’d seen it all coming “from miles away”.
The only son of a Yorkshire family that made its fortune in the tanning industry, Odey read history and economics at Oxford and trained as a barrister, but switched to the City when his family ran into financial difficulties.
In 1985 he began working at Barings International, where he “flourished”, says the FT. But when Barings shifted its investment approach away from “individual star bankers”, he decided to set up on his own.
With backing from investors including the billionaire financier George Soros, he formed Odey Asset Management in 1991. The timing was propitious.
“It was the dawn of an era in which soaring stockmarkets created vast fortunes for a growing number of hedge funds run by imperious managers.”
Odey played the part perfectly. Although the early years of his fund were “tumultuous”, his “willingness to endure risk levels most financiers could not tolerate helped him recover” – a pattern repeated throughout his career.
His reputation as one of the “smartest guys” in the City was sealed when he cleaned up during the financial crisis, having instructed staff to start shorting banks in January 2007.
By the end of 2008, assets under management had grown to $5.25bn.
Devotee of the two-bottle lunch
Odey and his trademark braces epitomised the old-school culture of the City, says The Times, and he was “a devotee of that declining institution, the two-bottle lunch”.
After a short first marriage to Rupert Murdoch’s oldest daughter, Prudence, he married Nichola Pease – a banker with dynastic ties to some of the City’s largest financial institutions – in 1991.
For a while, “they were improbably labelled the ‘Posh and Becks’ of the City”. Odey’s marriage crumbled after his acquittal of indecent assault charges in 2021.
Now he has been ousted from his firm, too. “I still think tomorrow they’re gonna take it all away from me,” he said with a laugh after betting on Brexit in 2016.
Percipient to the last, you might say.
-
-
Pension withdrawals on the rise, HMRC data reveals
Pension withdrawal data has led to some raising concerns over savers ‘raiding’ their pensions unsustainably.
-
ONS: UK economy recovered from pandemic faster than previously thought
Revisions from the ONS showed the UK economy has grown since the pandemic, while the latest data showed GDP grew in the second quarter of 2023.
