OppenheimerFunds shutters Tremont fund

OppenheimerFunds Inc. has elected to shutter its OFI Tremont Core Strategies Hedge Fund and start returning the fund's roughly $100 million in assets to clients in May. The fund has been subadvised by Tremont Partners & Co. Inc., which is owned by Tremont Group Holdings Inc., the Rye, N.Y.-based hedge fund investment firm that had $3.3 billion in total exposure to the money management business run by Bernard Madoff. A spokeswoman for New York-based OppenheimerFunds said that OFI Tremont Core Strategies — a fund of funds that divided its assets across more than 30 underlying hedge fund strategies — did not have any exposure to Mr. Madoff, who has been accused of running a $50 billion Ponzi scheme. “Liquidity has dried up in the hedge fund market,” said Jeaneen Pisarra, a spokeswoman for OppenheimerFunds, in explaining why the fund will be liquidated. “Specifically, an unprecedented number of hedge funds have sought to raise cash or close down, and the managers of the hedge funds in which OFI Core Strategies Hedge Fund invests have notified the fund that they will limit its funds' redemptions, as they are permitted to do so.” According to a regulatory filing, OppenheimerFunds will begin distributing assets from the fund to clients in May, but it added that it could take "until mid-2010 or later" to completely liquidate it.