Business

1,500 Neil Woodford investors sue over fund’s collapse

A second group of investors has filed a multimillion-pound lawsuit over the collapse of Neil Woodford’s equity fund, which caused losses to more than 300,000 savers.

London law firm Harcus Parker have launched proceedings in the High Court on behalf of 1,500 investors, seeking at least £18m in damages against fund managers Link Fund Solutions for their handling of the saga.

The law firm alleges that Link raked in millions of pounds in fees but failed to adequately oversee the £3.7billion fund.

It also claims Link failed to manage the fund’s liquidity, ensure its assets were appropriately valued and provide prudent risk diversification, all of which proved disastrous for investors.

Link said it will “strongly defend” the allegations, adding that it “acted and will continue to act in accordance with applicable rules and in the best interests of all investors.”

The lawsuit is the latest development in the infamous collapse of the veteran stock picker’s fund nearly three years ago.

The Woodford Equity Income Fund was suspended in June 2019 after Mr Woodford, who had taken large positions in hard-to-trade stocks, was unable to sell assets quickly enough to meet mounting withdrawal requests from investors. The fund closed in October 2019.

The lawsuit comes after Leigh Day filed a similar case on behalf of initially 100 plaintiffs last year.

The law firm alleged that Link allowed the fund to hold excessively hard-to-sell assets, violated regulatory rules in managing the fund, and caused significant investor losses.

Daniel Kerrigan, a senior associate at Harcus Parker, said, “Three years later…our clients are disappointed that it has become necessary for them to institute proceedings to recover their lost investments.”

Neither Mr. Woodford nor his company is a target of the lawsuit.

Last year, the former star fund manager lashed out at Link, dismissing widespread criticism of his operating style.

He said: “I can’t be sorry for the things I haven’t done. I didn’t make the decision to suspend the fund, I didn’t make the decision to close the fund. As history will now show, those decisions were incredibly damaging to investors, and they weren’t mine. They were Link’s decisions.”

https://www.telegraph.co.uk/business/2022/06/03/1500-neil-woodford-investors-sue-funds-collapse/ 1,500 Neil Woodford investors sue over fund’s collapse

Russell Falcon

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