Hedge Funds

Hedge funder John Paulson, who made a fortune betting against subprime, is cutting staff: Report

Key Points
  • John Paulson, the hedge funder who made billions betting against subprime, has laid off senior traders and partners, the New York Post says.
  • Paulson & Co.'s cuts include senior executives.
John Paulson
David Grogan | CNBC

John Paulson's high-profile hedge fund has laid off employees, including senior level traders, according to the New York Post.

Thursday's layoffs included partners Victor Flores and Allen Puwalski, as well as Keith Hannan, head of trading and Brad Rosenberg, head credit trader.

Paulson & Co. said in a statement to CNBC stating, "we are rightsizing the firm to focus on our core expertise in areas that are growing."

The hedge fund surpassed competitors during the financial crisis due to its bet against subprime mortgages using a kind of insurance called credit default swaps. Paulson made an estimated $12.5 billion to $15 billion in 2007 alone.

The one-time industry leader has experienced a sharp drop in performance from its peak, with one of Paulson's funds recently losing 70 percent and causing assets under management to plunge from a peak of $38 billion in 2011, with much of the remaining cash Paulson's own money.

Read more about the layoff in the New York Post's report.