GAM is said to be weighing cuts of 250 to 350 employees as new CEO Peter Sanderson seeks to restore profitability, according to the Financial Times.
The FT reported that Sanderson, who left BlackRock to join GAM in September of this year, held a recent company town hall, which left staff under the impression that heavy cuts were inevitable.
The cuts could represent more than 40% of staff, with GAM employing 863 staff at the end of June, according to its half-year report.
No final decision has been taken on the potential cuts but a source told the FT that losses in the group's back office would be "a natural consequence" of the exercise.
Sanderson joined GAM after a year in which the company had to liquidate its Absolute Return Bond fund range after it was suspended in August 2018. Portfolio manager Tim Haywood exited GAM in July 2018.
GAM accused Haywood of insufficient due diligence and of breaching the company's gift and entertainment policy.
Haywood maintains he had been "unfairly singled out" and denies claims of gross misconduct.
Last week (29 November), it was announced that head of investments Matthew Beesley, who joined the firm in 2017, would be leaving following a restructuring.