It sounds like a hedge fund firm's worst nightmare: Two top partners leave with their clients tagging along, and their assets trailing behind them. That, reports The Wall Street Journal, is the situation facing International Management Associates, as Chief Operating Officer Nelson Keith Bond and CFO Fitz Harper, both anesthesiologists, recently split. Not exactly what the hedge fund firm ordered, as it seems, according to the Journal, the Atlanta-based firm already has seen the depletion of $34 million of its $184 million AUM, with more likely on the way. IMA reportedly had been doing well, with its flagship Taurus fund boasting returns of 25% annualized returns for the five years ending 2004.

Firm founder and CEO Kirk Wright told the Journal, "We have been dealing with several clients looking for large redemptions, and we're trying to handle it so as not to adversely affect smaller clients."

He wouldn't disclose how much IMA was in danger of losing, but said it would likely be more than 20% of its assets. Already, clients reportedly are complaining about delays in getting their money, partly caused because of year-end accounting that first must be completed. "I think we have a serious issue on the table with principals defecting and trying to take clients with them," Wright said.

What went wrong at Wright's firm is not clear. IMA reportedly is in discussions about the situation with the Securities and Exchange Commission.