Neil Woodford bouncing back

Former star fund manager Neil Woodford is planning to start a new investment firm, even though the Financial Conduct Authority (FCA) has yet to conclude its investigation into his previous enterprise.

The move has led to calls for an independent enquiry into how Mr Woodford, whose Woodford Investment Management was suspended in 2019, could bounce back so quickly.

His former business imploded in 2019, while still holding assets worth £3.7 billion on behalf of more than 300,000 investors, which led to the investment industry’s biggest crisis in years.

Just before the firm’s collapse, Kent County Council withdrew a £236 million investment mandate from it and Mr Woodford prevented other investors from selling, meaning they lost huge amounts.

However, in a recent interview in the Telegraph, he apologised for his previous behaviour and pledges not to repeat the mistake of investing ordinary investors’ money in illiquid stocks. In fact, his new venture, Woodford Capital Management Partners, which is to be based in Jersey, would only cater to professional investors.

This has not placated investors in the previous business, however, with one spokesman for a shareholder rights’ group calling the move “a huge kick in the teeth” for those whose money was lost.

Around £2.54 billion has been returned to investors from the equity income fund, with £192.6 million remaining, according to the authorised corporate director of the collapsed fund, Link Fund Solutions.

Mr Woodford has hit out at the actions of Link Fund Solutions, however, saying that the decision to close the fund in October 2019 was made by Link, although they dispute this, claiming that the decision to suspend the fund was made jointly.

The FCA investigation started in June 2019 and late last year, the Treasury Committee asked for an update. According to a spokesman, while the investigation was delayed due to the pandemic, it is expected to be complete in the first quarter of this year.

Posted in Forensic.