Seeking Alpha – "In my view they didn’t do what they set out to do … which was to hedge. I saw a few hedge funds that did much worse than my long-only fund, which is rather ironic," [Veritas Asset Management manager Ezra Sun] said.

The losses have disappointed many investors who had expected positive returns in all market conditions, and hefty withdrawals of somewhere between a fifth and a third of the industry are widely expected at the end of the year. There was the risk people could perceive hedge funds as a "rip-off" because they had been charging high rates on the implicit promise they could deliver absolute returns, but did not deliver when global markets collapsed.

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Tags: advisory-services, arch-nemesis, bad-news, beta, health-care, levies, management-manager, medallion, oeh, smart-strategies, stage-fund, trillion, volatility

Reuters UK - Hedge funds are suffering "tremendous" reputational damage because promises to make money whichever way markets move have not been fulfilled, although in the long run the industry will benefit from the shake-out, Veritas Asset Asset Management manager Ezra Sun said.

Hedge fund "cowboys" boosting returns with lots of borrowing rather than smart strategies were the main culprits for the reputational damage, with investors blaming them for charging high fees and blocking them from withdrawing their money, he said.

"The market in the past few years has been rewarding people who’ve been running basically leveraged long-only funds," Sun told Reuters in an interview.

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Tags: bad-news, economic-index, health-care, investment-arm, june-14, losers, medallion, third-party

New York Post – Hedge fund executive Hunter Biden has had anything but a quiet introduction to his career in finance.

The 38-year-old son of Democratic vice presidential candidate Sen. Joe Biden is caught up in several lawsuits regarding the acquisition and operation of Paradigm Companies, an investment firm that operates a fund of funds – a hedge fund that invests in other hedge funds.

Biden also appears to be feuding with partner James Park, the son-in-law of the Rev. Sun Myoung Moon, Court papers show.

Biden, also a Washington lobbyist, took control of Paradigm in August 2006 and was, for a brief period, its president – getting paid $1.2 million a year despite no experience in the sector, according to charges in one of the suits.

Months later, Anthony Lotito, a consultant, sued Biden, James Biden, his uncle, and Paradigm for allegedly cheating Lotito out of fees related to the purchase. Biden has denied the charges and the suit is awaiting trial.

Hedge fund executive Hunter Biden has had anything but a quiet introduction to his career in finance.

The 38-year-old son of Democratic vice presidential candidate Sen. Joe Biden is caught up in several lawsuits regarding the acquisition and operation of Paradigm Companies, an investment firm that operates a fund of funds – a hedge fund that invests in other hedge funds.

Biden also appears to be feuding with partner James Park, the son-in-law of the Rev. Sun Myoung Moon, Court papers show.

Biden, also a Washington lobbyist, took control of Paradigm in August 2006 and was, for a brief period, its president – getting paid $1.2 million a year despite no experience in the sector, according to charges in one of the suits.

Months later, Anthony Lotito, a consultant, sued Biden, James Biden, his uncle, and Paradigm for allegedly cheating Lotito out of fees related to the purchase. Biden has denied the charges and the suit is awaiting trial.

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Tags: alignment, british-pound, contracts, court-decision, felony-convictions, health-care, initiative, legal-actions, multibillion-dollar, washington-lobbyist

Seeking Alpha- In a 13G filing after the close Friday on Sunoco, Inc. (SUN), Philip Falcone’s Harbinger Capital disclosed a 6.6% stake (7,732,600 shares) in the company. The hedge fund did not show a stake in Sunoco at the quarter ended 03/31/08.

A 13G indicates a ‘passive investment’, but Harbinger is a known activist investor. Most recently, Harbinger called on Cleveland-Cliffs (CLF) to cancel its merger with Alpha Natural Resources Inc. (ANR), saying it was not in the best interest of shareholders.

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Tags: arch-nemesis, citigroup, coalminer, first-avenue, health-care, img-src, lead-investor, market-share, mistrust, moly-mines, south-korean, stakeholder, westwood, worth-star-telegram