Updated from 3:30 p.m. EST
Cerberus Capital Management, the $27 billion private investment manager, has limited withdrawals from its Cerberus Partners fund, which is down 16% for the year through November, according to a CNBC report.
The network's David Faber says Cerberus has also limited withdrawals on other funds where it doesn't already have investor money locked up for several years under the original terms of the contract.
Citing a Dec. 19 letter from Cerberus founder and top executive Stephen Feinberg, Faber says Cerberus is sitting on losses in residential mortgage backed securities, having wrongly believed the market for RMBS had bottomed at the end of September.
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