Ocean Leonid Investments, a hedge fund reportedly linked to Iranian oil trader Hossein Shamkhani, has informed staff in its Curzon Street office in London's Mayfair that the firm is preparing to liquidate its operations in the UK, according to a report by Reuters.

The report cites unnamed sources as revealing that the decision was communicated through letters and phone calls, with the firm citing license restrictions as the reason for halting its UK activities.

While the majority of Ocean Leonid’s assets and liabilities are based in the United Arab Emirates, some funds were reportedly routed to London to facilitate trading, although it remains unclear what specific license constraints have necessitated the closure, according to the sources.

Ocean Leonid’s employees were approved for client dealings in the UK until 26 November, as per the Financial Conduct Authority’s (FCA) registry. A spokesperson for Ocean Leonid declined to comment on the situation, and the FCA did not respond to requests for clarification.

The hedge fund is already under scrutiny having recently been suspended by Dubai’s financial free zone, the Dubai International Financial Centre (DIFC), and is the subject of an investigation by the US Treasury Department. Earlier, Ocean Leonid stated it was in "active discussions" with the DIFC regarding the suspension and was cooperating to address inquiries.

A Bloomberg investigation in October alleged that Ocean Leonid operates as part of a network overseen by Hossein Shamkhani, a well-known oil trader and son of an adviser to Iran's Supreme Leader Ayatollah Ali Khamenei. Representatives for Ocean Leonid have firmly denied these claims, stating that Shamkhani has no involvement with the firm. Shamkhani’s lawyer has also rejected any association between his client and the hedge fund.