Eisman Not Leaving FrontPoint ... Yet

NEW YORK ( TheStreet) -- Investment guru Steve Eisman states that he is not leaving FrontPoint Partners -- the hedge fund he helped create -- despite published reports he is planning moving on to a new firm.

"I am not leaving FrontPoint now," he said in a one-paragraph e-mailed statement to Reuters. "I am in discussions on a structure which will provide me with greater operational flexibility and control over my own business. I will be managing money for FrontPoint and its clients for many years to come."

The Wall Street Journal reported that Eisman was possibly leaving the firm and that his departure could pose a problem for Morgan Stanley ( MS) to spin off the business. The article implied that the investment bank may have to close the hedge fund.

Frontpoint and Morgan Stanley declined to comment on reports of Eisman's departure.

Morgan Stanley has stated in its quarterly report that they intend to spin off FrontPoint by the end of the first quarter of 2011 to comply with the Volcker Rule.

Eisman became a well-known critic of the subprime mortgage business and his bets against the market became the main subject of Michael Lewis' book, "The Big Short."

As of late, FrontPoint Partners, has come under fire. In November investment manager, Joseph F. "Chip" Skowron, was forced to leave the firm after a French doctor was accused of giving a hedge-fund insider information about a clinical drug trial.

--Written by Maria Woehr in New York.

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