ALEX BRUMMER: Woodford victims braced for another paltry payout after bungling liquidator dumped biotech stocks which later soared 420%
Savers unfortunate enough to have put their faith in disgraced fund manager Neil Woodford will shortly receive notification that a third wind-up payment from his LF Equity Income Fund has arrived or will soon be credited to their bank or investment account.
More than 15 months have passed since the most high-profile and far-reaching savings scandal of recent times and still there has been no reckoning for those involved.
Andrew Bailey – the regulator in charge of the Financial Conduct Authority in the build-up to the failure of the Woodford empire – has moved onwards and upwards as governor of the Bank of England.
Neil Woodford is still enjoying the fruits of the £8m fees he received while investors remained trapped in his funds, and is being sought for investment advice despite egregious failings
Woodford is still enjoying the fruits of the £8million fees he received while investors remained trapped in his funds, and is being sought for investment advice despite egregious failings.
Broker Hargreaves Lansdown, which exposed some 300,000 investors to losses in Woodford funds, is prospering on the back of some of the highest profit margins in the financial sector at around 50 per cent.
And Link, the authorised corporate director, has proved as hapless in winding up the Woodford funds as it was in making sure that savers’ money was safe.
It contrived to bulk-sell a package of Woodford’s biotech stocks hours before one of the key holdings, Synairgen, soared 420 per cent in value on the back of its promising treatment for Covid-19.
As all this has been going on, there has not been a peep from the rudderless FCA as to the outcome of its probe into the affair. It has a snail-like approach to inquiries and has been deliberately obstructive.
Only last week a former appeals court judge, Dame Elizabeth Gloster, criticised the FCA for delaying her investigation into the collapse of the mini-bonds firm London Capital & Finance with a late dump of 3,500 previously undisclosed documents.
We shouldn’t be surprised by the dawdling, ineptness and legalistic approach of FCA regulation.
More than a decade after the collapse and rescue by Lloyds of consumer bank HBOS a report into management failings is still buried in the bureaucracy. The chairman of the FCA, Charles Randell, should be ashamed of this record.
New chief executive Nikhil Rathi needs to get a grip and order immediate publication of an interim report into the Woodford implosion. Investors, including this writer, deserve proper answers and need justice done.
Arm lock
One of the first big tests of Business Secretary Alok Sharma’s attitude towards British high-tech will be the proposed sell-off by Softbank of the UK’s smart chip champion, Arm Holdings, to US gaming chipmaker Nvidia.
Weekend reports suggested that if the £23billion sale were to go ahead, the Government would be inclined to sit on its hands.
Perhaps, someone should remind Sharma that when Theresa May’s government allowed Arm to be sold down the river it required Softbank boss Masayoshi Son to make solemn commitments on doubling the workforce, maintaining investment and keeping Arm in Cambridge.
At the very least, those stipulations must be renewed and extended by the next owners or the deal blocked.
Rising Son
Reaching 90 doesn’t seem to have inhibited the ambitions of Warren Buffett, who chose the last day of August to go East, buying 5 per cent stakes in several of Japan’s big trading houses including Marubeni, Sumitomo, Mitsubishi and Mitsui at a cost of a neat £5billion. Many happy returns.