Last year’s Weavering decision by a Cayman Islands court was a wake-up call for independent hedge fund directors who don’t take their responsibilities to fund investors seriously. The $600 million, London-based Weavering Macro Fixed Income Fund collapsed in 2009 after incurring losses during the financial crisis that were covered up by fictitious interest rate swaps with a company controlled by the fund’s founder, Magnus Peterson. The fund’s two “independent” directors — both related to Peterson — basically rubber-stamped Peterson’s every decision and, as a result of their willful neglect of their duties, were each fined an astounding $111 million. Then, earlier this year, a UK court found Peterson liable for defrauding the fund’s investors and three other fund executives (including Peterson’s wife) negligent for allowing the fraud to occur, imposing a $450 million fine on all four jointly and severally. So, while the first Weavering decision alerted non-executive hedge fund directors to the danger of kowtowing to a domineering CEO, the recent UK ruling has exposed a similar risk for any hedge fund executive who works for an imperious boss.