The Thundering Herd is beating a path away from one of John Paulson's funds

Bank of America's Merrill Lynch wealth management arm is pulling investor cash from one of hedge fund manager John Paulson's funds.

Merrill, which is home to an army of financial advisers often referred to as the 'Thundering Herd', is liquidating client funds from Paulson & Company's Advantage fund.

The news was first reported by the New York Times.

"As part of our commitment to our clients, we provide rigorous initial due diligence and ongoing detailed analysis of all funds on our platform, and remain in constant dialogue with fund managers regarding changes to the funds or their management," a Bank of America representative told Business Insider.

The redemptions total $81 million, according to a person familiar with the matter. That is equivalent to around 4% of the fund's roughly $2 billion.

The wealth manager has offered clients the option of shifting their redeemed funds into Paulson & Co.'s more successful M&A fund, according to the person familiar with the matter.

Paulson's special situations fund has also been put on "heightened review", according to the person familiar with the situation. The New York Times report stated that the fund is now closed to fresh funds from Bank of America Merrill Lynch's clients.