Deutsche Bank seized and auctioned collateral after the Horizon group of funds failed to meet the bank's demands. The funds were frozen a year ago because of wrong-way bets on mortgage securities.

"The survival of the funds and any potential recovery for their investors has been dependent on these lenders continuing their relationships with the funds,'' Mr Devaney wrote in the letter dated 9 July. United Capital is based in Key Biscayne, Florida.

The global credit rout spurred by the collapse of the subprime-mortgage market has led firms from Sailfish Capital Partners to Peloton Partners to liquidate funds or shut down this year. Other hedge fund groups have imposed strict redemption limits to prevent clients scrambling for the exits.