At World’s Largest Hedge Fund, Sex, Fear and Video Surveillance
Ray Dalio, the billionaire founder of the world’s largest hedge fund, Bridgewater Associates, likes to say that one of his firm’s core operating principles is “radical transparency” when it comes to airing employee grievances and concerns.
But one employee said in a complaint earlier this year that the hedge fund was like a “cauldron of fear and intimidation.”
The employee’s complaint with the Connecticut Commission on Human Rights and Opportunities, which has not been previously reported, describes an atmosphere of constant surveillance by video and recordings of all meetings — and the presence of patrolling security guards — that silence employees who do not fit the Bridgewater mold.
Hedge funds tend to be a highly secretive bunch, yet even within their universe Bridgewater stands out. The allegations, as well as interviews with seven former employees or people who have done work for the firm and a filing by the National Labor Relations Board, open a window into the inner workings of a $154 billion company that, despite its mammoth size, remains obscure. The firm is governed by “Principles” — more than 200 of them — set out in a little white book of Mr. Dalio’s musings on life and business that some on Wall Street have likened to a religious text.
Secrecy at Bridgewater is so tight that in some units employees are required to lock up their personal cellphones each morning when they arrive at work.
In his complaint, Christopher Tarui, a 34-year-old adviser to large institutional investors in Bridgewater, contends that his male supervisor sexually harassed him for about a year by propositioning him for sex and talking about sex during work trips.
After he complained last fall, Mr. Tarui said, several Bridgewater top managers confronted him and sought to pressure him to rescind his claims. One manager, he said, accused him of lying and said that he was “blowing this whole thing out of proportion.” These and other allegations in the complaint could not be independently verified.
Mr. Tarui said he remained silent for many months about the harassment out of fear the incident would not remain private and would impede his chances for promotion at the firm, which is based in Westport, Conn. “The company’s culture ensures that I had no one I could trust to keep my experience confidential,” he said in the complaint, which was filed in January.
Jointly, Bridgewater and Mr. Tarui asked in March to withdraw the complaint from consideration by the Connecticut human rights commission. No reason was given by either party for the request, which halted the investigation. Bridgewater’s employment agreement requires employees to settle disputes through binding arbitration.
In a related action, the National Labor Relations Board recently filed a separate complaint against Bridgewater. The new complaint says that the company “has been interfering with, restraining and coercing” Mr. Tarui and other employees from exercising their rights through confidentiality agreements that all employees are required to sign when they are hired.
Both Mr. Tarui’s harassment complaint and the labor board’s filings were obtained by The New York Times through Freedom of Information Act requests.
“While it is difficult for our management team to independently judge the merits of this claim, we are confident our handling of this claim is consistent with our stated principles and the law,” Bridgewater said in an emailed statement. “We look forward to operating through a legal process that brings the truth to light.”
Mr. Tarui’s assertions about Bridgewater’s surveillance culture and its chilling effect were echoed in interviews with seven people who are former employees or who have done work for the firm. The people were not permitted to speak publicly because of the confidentiality agreements they had signed with Bridgewater.
It is routine for recordings of contentious meetings to be archived and later shown to employees as part of the company’s policy of learning from mistakes. Several former employees recalled one video that Bridgewater showed to new employees that was of a confrontation several years ago between top executives including Mr. Dalio and a woman who was a manager at the time, who breaks down crying. The video was intended to give new employees a taste of Bridgewater’s culture of openly challenging em