ECONOMY

Executives at hedge fund Renaissance to pay $7bn in back taxes

Renaissance Technologies updates

Top executives of Renaissance Technologies and their spouses have agreed to pay about $7bn in back taxes and penalties to federal authorities in connection with trades made by the quantitative hedge fund in the largest tax settlement in US history, according to people briefed on the matter.

Jim Simons, a mathematician and former cold war codebreaker who founded the fund about four decades ago, will pay an additional $670m, according to a letter the group sent to investors, which has been seen by the Financial Times.

The settlement puts an end to a long-running dispute linked to trades made by the firm’s Medallion fund between 2005 and 2015, when several of its executives converted short-term capital gains into long-term profits, which are taxed at a significantly lower rate.

Renaissance has also counted among its top executives Robert Mercer, who financed the far-right news website Breitbart and backed a number of Republican political candidates including former US president Donald Trump.

News of the settlement was first reported by the Wall Street Journal.

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