In the wake of a huge staff layoff earlier this week, Toronto-based One Financial Corp. announced Thursday that it is winding down all the funds in its All-Weather Profit Family portfolio immediately, save for its Global Diversified Fund.

The firm said it would return subscriptions for the Global Diversified Fund to investors. Portfolio management services to that fund have been halted. However, redemptions will still be allowed to take place.

“We are working diligently to make sure there is [an] orderly wind down to that fund family as possible,” said One Financial CEO Jeffrey O’Brien in an interview, who added that he has been in regular contact with the Ontario Securities Commission (OSC) over the last few days. The All-Weather family consists of 10 mutual funds and six wrap portfolios.

This is latest turn of events in what has been a hectic week for the beleaguered asset management company.

On Monday, the firm laid off more than 70% of its staff. O’Brien said the firm needed to restructure operations in the wake of the unsuccessful launch of the fund family.

“Everyone seems to be a bit in the dark right now,” says one of the firm’s former employees who asked not to be named. “Everyone was blindsided by the news.”

At the end of day last Friday, O’Brien called all of One Financial’s Toronto staff into an impromptu meeting. He told employees that their payroll had been missed but that it would be covered soon.

When employees reported for work the next Monday morning, the office’s files were packed away and it looked as if the office was shutting down, says the former employee.

After collecting personal items from their desks, the firm’s staff gathered in the lobby of their 200 King Street West office. O’Brien told staff members that he was restructuring the company and that they were being laid off.

“As far as I was concerned it was business as usual until Friday afternoon,” said another staff member who was let go by the firm. “I really don’t know what else there is to say right now except that we’re all shocked.”

O’Brien said in an interview that the restructuring was caused by difficulties the firm faced in gaining sufficient access to distribution channels for the All-Weather Profit fund family, a suite of long-short mutual funds.

Although there was some interest from Canada’s big banks, he says, many were reluctant to give their clients access to the new funds until One Financial had, at least, a few hundred million dollars under management.

“It was a bit of a chicken and egg thing,” O’Brien says.

In order to raise cash, the firm announced its initial public offering, in hopes to raise about $9.6 million. The initial closing deadline was scheduled for April 30 but was extended to May 31 “in response to significant demand from Canadian investors and their financial advisors,” said O’Brien in an April 30 news release.

When the IPO didn’t prove as successful as O’Brien had originally envisioned, however, he decided to act swiftly.

“It became evident in the last couple of days that we weren’t going to be as successful as I had been lead to believe,” he said in the interview.

“We came to the realization that the sales and marketing platform we had developed to go out to all the dealers across Canada […] was not going to be able to [be executed],” he said. “So we had to make a prudent decision to re-group and re-evaluate our strategy.”

O’Brien said he hopes the steps that have been taken will help him build a strong business in the long-term.

For the time being, however, that statement offers little consolation to the employees affected.

“We don’t have any paperwork that you would get when terminated,” says one of the former staffers.

Founded in 2001, One Financial also has home offices in Montreal and Vancouver.