Image may be NSFW.
Clik here to view.
Bank of America's Merrill Lynch wealth management arm is pulling investor cash from one of hedge fund manager John Paulson's funds.
Merrill is liquidating client funds from Paulson & Company's Advantage fund.
The redemptions total $81 million, according to a person familiar with the matter. That is equivalent to around 4% of the fund's roughly $2 billion.
That person said Merrill Lynch has offered clients the option of shifting their redeemed funds into Paulson & Co.'s more successful M&A fund.
The news of the redemptions was first reported by The New York Times.
A Bank of America representative told Business Insider: "As part of our commitment to our clients, we provide rigorous initial due diligence and ongoing detailed analysis of all funds on our platform, and remain in constant dialogue with fund managers regarding changes to the funds or their management."
The decision to redeem the positions followed concerns over illiquid investments, according to a second person familiar with the matter.
Paulson's Recovery Participation fund has also been put on "heightened review," according to the second person. The firm agreed to make changes to the firm pertaining to illiquid investments and exposure to volatility after Bank of America voiced material concerns, the person said.
