Beechwood, a group of reinsurance and asset management companies, has been sold in a last ditch attempt to salvage the firm instead of shutting it down after it suffered reputation loss when hedge fund Platinum Partners collapsed after a federal investigation, Reuters reported.
Platinum’s top executives and founder were arrested in December and are in an ongoing court battle against fraud charges by U.S. authorities, to which they’ve pleaded not guilty.
Beechwood has attempted to stem off all ties to Platinum, but was pressured into selling after losing clients over the Platinum fraud charge.
A lawsuit to Beechwood and its executives has been filed by Indiana insurer CNO Financial Group subsidiaries, which cut ties with the firm over the Platinum scandal, Reuters said.
Reuters noted Cayman Island regulators recently reported the sale of subsidiary Beechwood Re to Deloitte, the Cayman Islands Monetary Authority (CIMA) said in a notice it would asses Beechwood’s financial position and report findings to CIMA.
Beechwood Re has returned assets to clients, and Platinum hedge funds are being liquidated under regulators’ supervision.