Goldman Sachs is withdrawing more than $120 million from Harbinger Capital Partners' most prominent hedge fund, the $3.4 billion Harbinger Capital Partners Fund. Harbinger has approximately $20 billion in assets under management. Goldman's withdrawal comes after revelations that Harbinger's CEO, Philip Falcone, borrowed hundreds of millions from the firm's other funds to pay personal taxes as well as the relatively poor performance of the fund.
Because redemption agreements with Harbinger limit quarterly redemptions to 25% it will take 12 months for Goldman to receive its entire investment. It is reported that Goldman had as much as $1 billion invested with Harbinger.
Philip Falcone, who grew up in Minnesota and was a star
hockey player in college, helped Harbinger funds return more than 100% in 2007 with timely bets that the U.S. housing market would collapse.
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