The UK’s financial regulator has moved to fine former high-profile fund manager Neil Woodford and his company Woodford Investment Management (WIM) a combined £45.9 million, following the collapse of the Woodford Equity Income Fund (WEIF).
The Financial Conduct Authority (FCA) announced it intends to fine Woodford £5.89 million and impose a ban preventing him from holding senior management positions or managing retail investment funds in future.
WIM is also facing a £40 million fine for its role in the fund’s mismanagement.
The penalties relate to failures in the management of WEIF, which collapsed in October 2019 after a wave of investor withdrawals triggered by a series of poor-performing investments, many involving illiquid and hard-to-sell assets. The fund was subsequently frozen, closed, and wound up, affecting approximately 300,000 investors, including 130,000 clients of Hargreaves Lansdown.
Hargreaves Lansdown is currently facing legal action from thousands of investors who allege they were misled into backing the fund.
Over 5,000 Investors Sue Hargreaves Lansdown Over Woodford Fund Collapse
More than 5,000 investors are now suing Hargreaves Lansdown, alleging the UK’s largest investment platform continued to promote the Woodford Equity Income Fund (WEIF) despite being aware of serious issues with its performance and holdings.
The number of claimants has nearly doubled in the past two years, up from 2,750 in 2022, according to RGL Management, the claims management firm leading the action.
RGL estimates the total value of the claims will exceed £200 million, with the average individual claim — including interest — around £20,000.
The WEIF, managed by former star fund manager Neil Woodford, collapsed in October 2019 after investors rushed to withdraw funds amid a string of poor-performing and illiquid investments. The fund was frozen, closed, and subsequently wound up, leaving around 300,000 investors facing losses.
