Melvin Capital clients rage at founder Gabe Plotkin

Melvin Capital said it’s finally going out of business after Reddit investors beat it last year, and now customers are doubly angry that its founder, Gabe Plotkin, is still charging them fees, The Post has learned.

Plotkin, whose massive short positions in “meme stocks” like GameStop made him a surprise punching bag for day traders during the throes of the pandemic, told investors in a Wednesday letter obtained by The Post that he will continue to cash in. rates to customers until June. one.

One angry customer speculated that Plotkin spent most of April and May considering whether or not to keep the fund open rather than make money for investors, adding that the ongoing fees were “beyond greedy.”

“I’m sure he spent the last two weeks on lawyers and paperwork and not on the fund or making us money,” the source fumed. “In the meantime you’re charging us fees for the entire month?”

The source adds that Plotkin can afford to reimburse May’s management fees. “The guy has made billions in the last few years, he’s not pinched for cash.”

Investors will start getting some of the money back from May 31 and will receive the rest of their funds in the first three weeks of July, according to Plotkin’s letter.

Melvin Capital has been struggling to recover after heavy shorting pressure from day traders at GameStop crushed the bottom in January 2021.
REUTERS

“The last 17 months have been an incredibly difficult time for the company and for you, our investors,” Plotkin wrote. “I’ve given everything I could, but more recently that hasn’t been enough to deliver the benefits you should expect. Now I recognize that I need to move away from managing external capital.”

A spokesman for Melvin declined to comment further.

Melvin has been struggling to recover after heavy shorting pressure from day traders at GameStop crushed the bottom in January 2021. Days later, Melvin received a bailout from hedge fund titans, including the owner of the Mets, Steve Cohen, and Citadel boss Ken Griffin. In April, the fund was down 23.3% year-to-date, according to a letter to investors reviewed by The Post.

Gabe Plotkin
“The last 17 months have been an incredibly difficult time for the company and for you, our investors,” Plotkin wrote.
Bloomberg via Getty Images

Over the past few months, Plotkin has gone back and forth on whether to return the capital to investors. In April, he suggested that he would return investors their capital at the end of June and then allow them to reinvest in early July.

At the time, Plotkin said he would not try to win back the investors. Instead, it would demand performance fees from potential customers, including those who previously lost money on it. Plotkin reportedly said he would keep the new fund small, under $5 billion, and focus on shorting stocks.

After facing backlash, Plotkin told investors in a dramatic facelift that he would delay his decision to close the fund, as The Post first reported.

Despite the impending closure, Plotkin’s lifestyle thus far appears to be unaffected by his recent losses.

“Plotkin should sell his $44 million house in Miami Beach after losing us all so much money…instead of charging us more fees,” the investor fumed.

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