US hedge fund Elliott Management has amassed a roughly £200mn exposure to UK mortgage provider MFS, which collapsed last week amid fraud allegations. The position was acquired from Chetwood Bank, a Wrexham-based lender majority-owned by Elliott, which originally held the stake in a lending facility arranged for MFS.

Elliott joins major financial institutions including Barclays, Jefferies, and Apollo Global Management that extended £2bn to MFS before its collapse. The Mayfair-based lender entered insolvency after creditors identified serious irregularities, including the practice of "double pledging" collateral to multiple lenders without disclosure. This left institutions exposed to potential shortfalls.

The collapse has reignited concerns about underwriting standards in the booming asset-backed lending market. Barclays, which provided banking services and accumulated roughly £600mn in exposure, began blocking transactions in late 2025 and froze MFS's accounts in January after months of scrutiny following similar fraud cases in the US market.