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Top fund manager forced to retire following BBC investigation



  Mark Denning Copyright copyright
Capital Group

One of the world's leading fund managers has been forced to resign after the BBC discovered he had broken investment rules.

Mark Denning helped manage more than $ 300 billion (£ 229 billion; € 265 billion) of investors' money with Capital Group.

BBC One's Panorama uncovered evidence suggesting that he had secretly acquired shares for his own benefit in some of the same companies as his fund.

Mr Denning, who had worked in the firm for 36 years, denies any wrongdoing.

The 62-year-old fund manager left his job five days after Panorama wrote to Capital Group about the findings of the investigation.

Capital Group ̵

1; which manages nearly $ 2 trillion of assets – said Mr. Denning was no longer with the firm.

"We have ethical guidelines and requirements for personal investment information that hold our employees to the highest standards of conduct. When we learned about this matter, we took immediate action."

This is because their size means that the funds can raise the company's stock price when investing. The fund manager could use this power to push up the share price of the companies where they have personal investments, rather than choosing the companies that provide the best return for investors.

Leaked Documents

The Panorama investigation discovered that shares were purchased following Mr Denning's instructions through a secret fund based in Liechtenstein.

It was called the Morebath Fund Global Opportunity.

Leaked documents show that the Morebath Fund had invested in a medical research firm called Mesoblast, an Indian film company called Eros International and a gold mining company called Hummingbird Resources.

Capital Group funds also invested in all three companies, and the investments in Mesoblast and Eros were made by funds that Denning himself helped manage.

In the case of Hummingbird Resources, Denning appeared to have another potential conflict of interest when the company was created and run by his son-in-law.

Conflict of interest

An expert on financial rules told Panorama that private purchases by Denning could represent a serious conflict of interest.

Michael Ruck, investigative partner at the law firm TLT, said: "The whole point behind declaring conflicts of interest is to protect investors.

" If there was an intention by the fund manager for financial benefit to himself, the serious concerns regarding their actions. "

The shares in the three companies were eventually held through an offshore entity called Kinrara Trust. It was set up and controlled by Mr. Denning.

" Compliance with duties "

Attorney Dennings denies that he owns the shares in the three companies because they say he is not a beneficiary of the Kinrara Trust.

"Our client did not declare his interest in the Kinrara Trust to his former employers because he had been irrevocably excluded as a beneficiary. He believed that he had fulfilled all his relevant duties. "

Attorney Dennings says he received poor advice. They also say that the Morebath Fund had an independent asset manager and fund manager.

Panorama, however, has seen evidence that Mr Denning was behind the share purchases of the three companies and documents show that the Morebath Fund was regularly included in a summary of his personal assets.

Mr Denning appears to have named the Liechtenstein-based fund after the village of Morebath in North Devon. owns a nine-bedroom house, Morebath Manor, and 21 acres of parkland in the village.

The fund manager also owns luxury homes in Chelsea and the Bahamas.

Controversial Energy Agreement

Denning worked for the Capital Group in London and was approved by the City watchdog, Financial Conduct Authority until 2018.

However, four of the funds he managed were directed at American investors, and he had worked from company the monkey's office in Los Angeles.

Panorama also discovered that Kinrara Trust owned Kinrara International – a company that served on a controversial energy deal in Senegal.

Kinrara International earned $ 22 million after the exploration rights to a huge gas field off the Senegalese coast were sold to BP.

Experts have told Panorama that they believe Mr Denning should also have stated this – because Capital Group had investments in BP and another company involved in the agreement called Kosmos Energy.

Lawyers at Denning say he has never been a legal or beneficial owner of Kinrara International.

Panorama Can you trust investors for the billion pounds? Ships Monday at 8:30 PM


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