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Newsletters

Quarterly Newsletter – Q2 2009

Posted on 17 Jun 2009

Laven rebrands group services

We are pleased to announce that we have recently re-branded our three group companies.

Our investment advisory firm Laven Partners LLP, has changed its name to Laven Advisors LLP, and our law firm recently changed its name to Laven Legal Services Ltd, re-emphasising its cooperation and association with our hedge fund consultancy arm Laven Partners Ltd. Laven Partners Ltd has retained its name.

We hope that this rebranding will enable our clients and other industry professionals to better identify the law firm as part of the group, as well as make a more distinct separation between the activities of Laven Partners Ltd and Laven Advisors LLP.

The name change builds on a strong reputation and market position which we will expand on as we continue to provide quality services under the Laven brand.

Laven is an investment management group offering consultancy services to fund managers and investors, including fund structuring, tax, legal and compliance as well as operational due diligence and advisory services.

All group companies have also adopted a unified logo further emphasising the ethos of quality, enthusiasm and proactivity wich underline the Laven brand.

Please find below a summary of our group services:

Laven Partners Ltd Laven Legal Services Ltd Laven Advisors LLP
FSA Applications
Compliance
Risk management
Operational due diligence
Data listing services
Compliance training
English law and Luxembourg law:Fund structuring & documentation
Tax
Company formations
Negotiating service agreements
Mergers and acquisitions and joint ventures
Legal advice on regulatory mattersEmployment law
Employment benefit trusts
Investment advisory services based on fund screening and risk monitoring systems

Laven Partners wins award for BEST REGULATORY ADVISORY FIRM

Laven Partners received the HFMWeek Service Provider Award 2009 in the category of ‘Best Advisory Firm’ during the winners’ announcement ceremony on Thursday 21 May 2009 at London’s Hurlingham Club.

The HFMWeek Service Provider Awards consist of 17 categories and cover various service provider areas of the hedge fund industry such as prime brokerage, advisory and fund administration.

The award was accepted by Jérôme de Lavenère Lussan, founder and Managing Director of Laven Partners. “This award is a great recognition of the work of our team and we are very proud to have received it. We have experienced an increased demand for tailored advisory and due diligence services. For many investors the off-the-shelf approach by institutional advisors is no longer appropriate, particularly in the current climate. The Laven group, which combines advisory, compliance, structuring and legal services is agile and able to provide global solutions, but also ‘small enough to care’”, said Mr Lussan.

Lussan went on to note that industry focus is shifting from pure acceptance of performance to paying more attention to the broader framework and infrastructure of investment funds. “The new regulatory pressures for transparency are raising the standards for the industry hence improving areas of work relating to operations and risk management and creating better value for hedge fund investors. Laven Partners is committed to ensuring that the service our clients receive in 2009 and beyond will continue grounded in our principles of quality, pro-activity and enthusiasm which have served our clients so well.”

The HFM Week Panel of Judges said: “We were impressed by the energy of the team and Laven’s plethora of good ideas. Founded on the principle that the hedge fund and asset management industry was inherently weak because of general ignorance of the compliance and corporate environment, Laven aggregates expertise from bankers, financial analysts, compliance specialists, lawyers and investment consultants to shed light on this. In an age of growing regulation and corporate governance, Laven Partners’ experience and understanding of both hedge funds and compliance shone through.”

Laven Partners: UK hedge fund industry under threat over draft EU Alternatives Directive

Laven Partners was recently featured in the Hedge Fund Journal commenting on the proposed Alternatives Directive by the European Commission.

Some of the UK’s largest hedge funds have warned the Treasury that they will bid farewell to Britain unless the draft EU Alternatives Directive is drastically modified.

Jerome de Lavenère Lussan, managing director of Laven says: “Managers find the proposed Directive restrictive and out of touch with industry realities. The Directive would add to the MiFID rules introduced only in 2007, which themselves were poorly implemented. We do believe the new Directive raises some important issues such as disclosure requirements, that should help improve trust and transparency for investors, but to succeed the European Commission must avoid alienating the industry and focus on the practical needs that benefit investors, not politicians.

He added that: “The idea of an EU regulator is ambitious but if its foundations are right, it could be the best way for the EU to compete worldwide. However, EU member states are already unable to agree on industry best practices, so it is hard to see political consensus on regulations.”

At a meeting earlier this week, the FSA and the Treasury assured that they would fight for the changes required to keep managers in the country. However, Laven believes the UK’s biggest failure is not introducing laws which enable the establishment of onshore UK-based alternative funds. Lussan says: “These laws exist in France, Luxembourg and Germany for example, so why not in the UK? It would be a great opportunity for Britain to grow its hedge fund industry, providing jobs and boosting the UK economy.”

Laven Partners emphasises importance of good internal compliance procedures and corporate governance

With the current global pressure on increasing hedge fund regulation, Laven Partners believes it is important for asset managers to review their current regulatory responsibilities and improve their internal systems. Laven Partners believes that despite the proposed EC directive, the UK’s current regulation can and will work well where it is applied. In the EU there is a strong regulatory framework, but it needs to be applied with more diligence and greater effort.

Jerome Lussan says: “Governments need to ensure better understanding and implementation of existing regulations. They should use whatever budgets are available to call for more internal/external audits of compliance rather than put tax payers’ money into more legislation. There are one or two simple solutions, notably better enforcement, which will help clean up all abusive practices, whether in banks or hedge funds. This would increase confidence rather than simply create more legal and economic uncertainty for our financial systems.”

Laven Partners provides asset management companies with a variety of compliance control solutions. “We think ahead of our clients’ regulatory requirements throughout the year. When it is time for an internal report to be filed, we remind our clients in advance and help them draft it.  When regulatory reports are due, we work closely with our client to ensure all the calculations are right, well ahead of any reporting deadlines”, Mr Lussan said.

Laven Partners’ compliance controls services start at as little as £2,000 a month and include financial and regulatory reports, implementing a compliance infrastructure and MLRO reports. We can also help investment businesses draft their Independent Capital Adequacy Assessment Process (ICAAP) from as little as £4,000.*

Our services can be of immediate benefit to investment businesses and the end result will give comfort to the regulator and the firm’s clients.

*All prices depend on the size of the firm and the scale of its activities. Laven Partners Limited reserves the right to cancel and change terms and conditions of offer and promotion without notice. No warranties or representations expressed or implied are extended. Services and limits of liability are governed by our standard terms and conditions.

FSA tightens up its approach towards market abuse

In March, Christopher McQuoid, Solicitor and his father-in-law James Melbourne were found guilty of insider dealing and were jailed for eight months. The case was the first insider dealing criminal prosecution brought by the FSA. It was found that Mr McQuoid had passed inside information to his father-in-law and that Mr Melbourne had traded, and made a profit, using the information. Since the case, the FSA has made three more arrests relating to three separate market abuse investigations.

The Financial Services and Markets Act 2000, gives the FSA powers to investigate and prosecute insider dealing, and fighting market abuse has been a regulatory priority since the FSA’s Business Plan 2007/08. The FSA has promised to pursue more criminal cases and levy higher civil fines to boost deterrents in its battle against market abuse.

The FSA said of the recent insider dealing case: “By pursuing a criminal prosecution in this case, the FSA has shown that we will take tough action to achieve our aim of credible deterrence in the financial markets. – Anyone engaging in similar acts should see this as a clear warning that the FSA intends to bring all its powers to bear to protect the integrity of our markets”.

Hector Sants, the FSA’s chief executive officer, said on 5 May 2009 “Penalties have been too small in the past and the regulator will consult, most likely in the next three months, on how to change the framework for meting out fines. Higher penalties will be another way to achieve “credible deterrence” to other would-be rule-breakers.”

In May 2009, the FSA also fined £140,000 and banned Nilesh Shroff, an ex-Morgan Stanley trader after having traded ahead of clients to profit from their orders. The FSA said of the ‘front-running’ case: “Shroff has been banned from trading because he repeatedly abused his position of responsibility — and the trust placed in him –. He was aware of FSA guidance and Morgan Stanley’s rules in relation to pre-hedging but nonetheless he broke them.”

Laven Partners believes that the FSA will continue to place emphasis on the prevention, detection and deterrence of market abuse. Laven Partners would like to remind firms that market abuse includes action as well as inaction. For firms who wish to remind and up-date their staff of the market abuse regulations, Laven Partners offers practical and cost-effective training courses. Our training days are tailored to clients’ needs and can vary from two hours to full-day courses. We can cater from two to ten delegates at a time and if necessary, we can also organise seminars for larger groups.

Laven Legal Services bolsters team with new appointment

Laven Legal Services has expanded its team with the appointment of Oliver Quarmby as Solicitor and Senior Associate. Oliver will advise on a number of specialist services including the structuring of off-shore and on-shore companies, private placements and compliance as well as joint ventures, tax and mergers and acquisitions in the managed fund industry.

Alexandra Tzalla, Manager at Laven Legal Services, says: “Oliver has joined at an exciting time for Laven Legal Services, as well as expanding our team we have recently opened an office in Luxembourg and are looking at other overseas opportunities. We believe our client service standards set us apart from our competition and the strength of the team is key to our success. Oliver has extensive experience in advising funds and his work on mergers and acquisitions and IPOs will be a valuable asset to our firm.”

Oliver joins from Collins Stewart Europe Limited where he was Assistant Director of corporate finance. He started his career at city law firm Stephenson Harwood, where he specialised in funds and financial services.