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TOSCAFUND IN 15M PAYOUT AS PROFITS DIVE

HEDGE fund group Toscafund paid its highest earner &pound;15m last year, even though profits at the group fell by 83 per cent, it emerged yesterday.<br /><br />Official US filings show one member of staff at the firm received a &ldquo;profit entitlement&rdquo; of &pound;14.9m in the year, despite the group profit dive which was thanks mainly to dire performance on its flagship Tosca Fund.<br /><br />The firm stopped short of naming the executive who received the sum, but reports yesterday suggested it was likely to be group boss Martin Hughes, known in the City as &ldquo;the Rottweiler&rdquo; for his aggressive fund management style.<br /><br />Vice chairman at the group, former Commerzbank director Mehmet Dalram, told City A.M. the reports were misleading and he did not know who received the sum.<br /><br />&ldquo;It&rsquo;s not me,&rdquo; he said. &ldquo;I don&rsquo;t know of anyone getting a bonus that big.&rdquo;<br /><br />This payout is much less than Hughes made last year when he took home &pound;75m.<br /><br />The firm, which manages around &pound;1.6bn in assets, said profit for 2008 before members&rsquo; remuneration and profit share fell to &pound;26.9m from &pound;158.2m in 2007.<br /><br />The firm was last year caught on the wrong side of trades, including the failed bank Northern Rock, the collapsed American insurer Washington Mutual, and housebuilders Redrow and Taylor Wimpey.<br /><br />Following those losses, investors in the flagship fund were offered the choice of either cashing out of their investments or staying in for a minimum of one year. Nearly two-thirds chose to exit.<br /><br />But the investment business said that this year so far its fund performance has picked up.<br /><br />The Tosca Fund is up around 25 per cent year-to-date, while the Opportunities fund has risen around 60 per cent.<br /><br />The Small-Cap fund has gained a stellar 58 per cent and the Asia fund has risen just under 10 per cent.