Jacob “Jake” Walthour, managing director of Citadel and head of U.S. distribution at its Citadel Asset Management subsidiary, left the firm last week, a few months after his first anniversary.
Sources who insisted on anonymity said Mr. Walthour’s departure is linked to miscommunication with an unnamed institutional investor about the March 7 resignation of Bill King. Mr. King, senior managing director and head of securitized products, was lead portfolio manager of the Citadel Residential Mortgage Opportunities fund, an onshore residential mortgage-backed securities fund.
The sources said the client was not informed in a timely manner by Mr. Walthour about Mr. King’s departure.
Mr. Walthour, who was reached at his home, would not comment. Devon Spurgeon, a Citadel spokeswoman, said Citadel is conducting a search for Mr. Walthour’s replacement but declined further comment.
Investor redemption requests after Mr. King’s departure prompted Citadel to liquidate the fund, three people familiar with the situation told Bloomberg News. Citadel also runs a $100 million mortgage fund for offshore investors that may also be wound down, the people said.
A consultant who also asked not to be named said the $200 million fund had a fair number of large institutional investors.
Mr. Walthour joined Citadel’s New York office in mid-January 2010 to focus on marketing the firm’s hedge funds to U.S. institutional clients. He had been principal and head of advisory services for the Americas at hedge fund consultant Aksia.
Bloomberg contributed to this story.