(Bloomberg) -- A former Morgan Stanley currency trader, who left the Wall Street giant in 2021 following a contentious internal probe, is shuttering the Brazilian hedge fund he started after a series of wrongway bets dovetailed with surging interest rates.

Upon Global Capital plans to vote on the liquidation in a general meeting of clients next month, according to a notice on its website. The Sao Paulo-based firm plans to give clients’ their cash by Oct. 13. 

“Thinking about doing the best for our clients and always aiming to fulfill our fiduciary obligation, we believe that closing the project is the right decision for everyone,” Upon said in the notice. 

Upon is set to join other Brazilian hedge funds that have been forced to close as they struggle with massive redemptions after double-digit interest rates prompted more Brazilians to park their cash in high-yielding government bonds. The firm has a little more than 400 million reais ($79 million) under management, according to Anbima, Brazil’s capital-markets association.

The fund was created by Thiago Melzer, who helped oversee foreign exchange options at New York-based Morgan Stanley until he was suspended and then ousted in 2021 after an internal investigation into suspected mismarking of transactions. He later challenged the Wall Street bank’s conclusions and the US Financial Industry Regulatory Authority ruled in his favor last year. 

Melzer didn’t immediately respond to requests for additional comment. 

Under Melzer, who is the fund’s chief investment officer, Upon had initially thrived. The flagship fund gained 20% last year, outperforming the Anbima Hedge Fund Index and the local deposit rate that investors use as a benchmark. 

But the fund is now down 2% year to date, underperforming rivals. It posted its worst month on record in April due to wrong-way volatility wagers and told clients in August that it had been trimming a short position on the S&P 500 Index, according to a review of investor notes. 

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