Shareholder Spotlight Bonus Edition #2 : Worst Eagle Investment Management

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First Eagle Investment Management – this supposed bastion of value investing, perched high in their Manhattan towers with billions under their wing – they’re no different from a shady street vendor peddling tainted meat. They promise prudence, downside protection, all that bollocks, but scratch the surface and you find a nest of scandals that reek of greed, discrimination, and outright contempt for the little guy whose retirement they’re gambling with. This isn’t some polished Wall Street fairy tale; it’s raw, it’s gritty, and it’s about time someone called them out without apology or a filter.

These bastards have been around since the 1960s, rebranded and gussied up under names like Arnhold and S. Bleichroeder, now boasting over $160 billion in assets as of mid-2025. They tout themselves as guardians of capital, focusing on gold, global equities, and all that jazz. But behind the glossy prospectuses and the smug faces of their portfolio managers, there’s a trail of lawsuits, regulatory slaps, and ethical lapses that would make even the most jaded chef blanch. And here’s the kicker: they’re knee-deep in holdings like Cummins Inc. (CMI), with their First Eagle Global Fund clutching about 1.12 million shares as of April 2025, valued at hundreds of millions. Across their portfolios, they’ve held around 1.5 million shares in total recently, making it a top position. That’s right, another player in the Cummins ecosystem, where ethical behaviour seems like a quaint suggestion rather than a rule. Cummins, you recall, got hammered with a $1.675 billion fine for emissions cheating, installing defeat devices on engines to fake clean air tests. First Eagle’s cosy with that crowd? Figures. It’s like they’re collecting companies with a penchant for bending rules, all while preaching long-term stewardship.

But enough foreplay. Let’s dive into the muck, subheading by subheading, because this exposé needs structure to keep from descending into pure rage.

The 2015 SEC Smackdown: Dipping into Investor Pockets Like It’s Free Lunch

Picture this: You’re an average punter, socking away your hard-earned quid into a mutual fund, trusting these wankers at First Eagle to play fair. But from 2008 to 2014, they were allegedly siphoning off $25 million from fund assets to pay for marketing gimmicks – shelf space at brokers, promotional perks, all that crap – without a proper plan or disclosure. The SEC called it a “distribution-in-guise” scheme, a fancy term for hiding sales expenses as something else to dodge the rules. Violations of Sections 12(b) and 34(b) of the Investment Company Act – serious shit. They settled for nearly $40 million: disgorgement back to the funds, penalties, interest. No admission of guilt, of course, because why own up when you can just write a cheque? This was the first case in the SEC’s sweep on such bollocks, exposing how these firms prioritise growth over fiduciary duty. Investors got screwed, trust eroded, and First Eagle? They carried on like nothing happened. Outrageous? You’re damn right. It’s the financial equivalent of a chef using yesterday’s fish and charging premium for it.

The Ugly Face of Discrimination: Oanh Nyugen’s Battle Against Bias

Fast forward to 2020, and the rot goes deeper, into the human element. Oanh Nyugen, a sharp Asian-American woman and former senior analyst, slaps First Eagle with a lawsuit alleging gender and race discrimination, retaliation, and unequal pay. She claims she was paid less than her male counterparts for the same grind, and when she piped up about it, they showed her the door. Hostile work environment, systemic bias – all under the watchful eye of majority owner Blackstone. Filed by Wigdor LLP, this isn’t some frivolous whine; it’s a gut-punch to the firm’s culture. In an industry already stinking of old boys’ clubs, this is shocking, raw proof that talent gets trampled if it doesn’t fit the mould. Nyugen sought damages for lost wages, emotional distress, the works. The outcome? Shrouded in settlements or dismissals, but the stain remains. How the hell do you build trust when your own people feel like second-class citizens? It’s fucking infuriating, a reminder that behind the balance sheets are real lives getting shafted.

The Bitter Aftertaste: Human Rights Blind Spots and Broader Ethical Lapses

As if regulatory and workplace rot wasn’t enough, First Eagle’s got their fingers in pies that stink of human rights abuses. They’re among 46 firms linked to Astra Agro Lestari, a palm oil behemoth in Indonesia accused of environmental devastation and rights violations against locals – land grabs, intimidation, the whole nasty lot. And First Eagle’s response? Crickets. They didn’t even bother replying to inquiries about it. In a world where ESG is supposedly king, this nonchalance is bloody shocking, like serving up endangered species and claiming ignorance. Tie this to their Cummins stake, and you’ve got a pattern: ethics as an optional extra, profits über alles. Cummins cheated on emissions, poisoning the air we breathe, and paid billions for it. First Eagle holding tight? It’s endorsement by inaction.

Why This Matters in a World of Smoke and Mirrors

In the end, First Eagle’s saga is a microcosm of finance’s dark side – a place where fiduciary duty is lip service, discrimination festers, and investor money fuels the machine without accountability. I’ve seen enough bullshit in my travels to know when something’s off, and this stinks to high heaven. Outraged? You should be. These scandals aren’t anomalies; they’re the system working as intended, until someone shines a light. If you’re invested, ask hard questions. If not, steer clear. The world’s full of better options than feeding vultures like these.

Lee Thompson – Founder, The Cummins Accountability Project

Sources

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