H2O to Repay Investors €250 Million to End Windhorst Scandal
- FCA says H2O failed to run proper due diligence on Windhorst
- Troubled asset manager avoided fine by paying out investors
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Troubled fund manager H2O Asset Management will repay its investors €250 million ($273 million) to settle a UK investigation after the regulator targeted the “close personal relationship” between then-Chief Executive Bruno Crastes and German financier Lars Windhorst.
The Financial Conduct Authority found that H2O AM LLP failed to carry out appropriate due diligence when investing in “highly illiquid” companies tied to Windhorst between April 2015 and November 2019. The authority also criticized H2O’s lack of safeguards surrounding conflicts of interests, saying that it found more than 50 occasions where hospitality or gifts weren’t properly declared, including when Crastes and his family went sailing on Windhorst’s superyacht.