A former fund manager in the US division of Allianz has accused the firm and its lawyers of double crossing him, according to a report in the Wall Street Journal. 

Gregoire Tournant, a chief investment officer and lead portfolio manager of the Structured Alpha trading strategy, was blamed for losses the firm suffered during Covid-19.

In a motion filed in New York federal court, Tournant, said prosecutors encouraged lawyers that were acting for the firm and himself personally to switch sides and use his privileged communications to build a false narrative against him and use him as a scapegoat.

The manager was accused of securities and investment adviser fraud charges in 2022, when the Securities and Exchange Commission said he orchestrated a multi-year scheme to mislead investors who invested $11bn in the strategy.

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The SEC complaint said Allianz and Tournant concealed the downside risks of the complex options trading strategy and that following the market crash in 2020 investor documents were rewritten to downplay the risky nature.

Allianz settled with the SEC and US Department of Justice and paid a fee of more than $6bn saying its internal controls had failed but the misconduct was limited to a handful of individuals. Tournant was arrested in May and pled not guilty.

According to the WSJ report Tourant said the legal arrangement made by Allianz during its investigation led to a situation where his lawyers became informants against him.

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Sullivan & Cromwell LLP and Ropes & Gray LLP were representing both Allianz and Tournant as they said this would be more efficient. However, Sullivan & Cromwell began an investigation that would lead them to suggest that Tournant committed wrongdoing, according to the WSJ.

Tournant has asked a judge to dismiss the charges against him as a result, or to hold a hearing to determine the extent of prosecutors' interactions with his former lawyers.

Allianz declined to comment.

Sullivan & Cromwell LLP and Ropes & Gray LLP have been contacted for comment.