One of the world’s most high-profile female financiers is facing a legal spat with her employees, the Mail can reveal.
Blythe Masters made her name at JP Morgan where she was credited with developing the credit default swap before the financial crisis in 2008.
She is today chief executive at UK-headquartered FNZ – a tech platform for wealth managers – and a founding partner at private equity firm Motive Partners.
But she now faces a showdown with employee shareholders who are fighting back over a number of fundraising rounds last year in which the company raised about $1billion (£750m).
As part of the cash collecting, FNZ took investment from a number of its existing institutional investors, including Motive Partners.
The move has angered 300 FNZ employees who claim it has diluted their shares in favour of the institutional investors.
Under fire: Blythe Masters made her name at JP Morgan where she was credited with developing the credit default swap before the financial crisis in 2008
In a legal letter obtained by the Mail, dated March 28, lawyers representing the employees wrote: ‘The share raise has diluted the shareholders’ holdings in FNZ and the shareholders consider that they have been unfairly prejudiced by the share sale.
‘In short the board of FNZ appears to have enriched its own interests at the expense of minority, unrepresented shareholders. The amounts at stake are such that litigation is inevitable absent a serious proposal by FNZ to remedy those losses.’
The employees are not seeking to block the fundraiser – which they see as key to the future growth of the business – but want to be compensated for the dilution, be able to monetise at least part of their holdings and receive some cash.
British-born Masters told shareholders on March 6 she acknowledged requests for information about the fundraisers and financial information but said ‘it is not appropriate to disclose information about these matters due to their commercial sensitivity’.
She was dubbed ‘the woman who built the financial weapon of mass destruction’ for her role in creating credit default swaps – the instrument that lay behind the 2008 financial crash.
FNZ, founded in 2003 and boasting Aviva, Barclays and HSBC as customers, has a total of $1.7trillion (£1.3trillion) in assets under administration. It declined to comment.
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