Investment firm chiefs give up bonuses over Woodford fund
BOSSES at investment company Hargreaves Lansdown are to give up their multimillion-pound bonuses over the Neil Woodford fiasco.
The firm was the fund manager’s biggest champion before he barred savers from pulling their cash out of his flagship Equity Income Fund two months ago.
The move triggered a flood of phone calls from angry customers to Hargreaves Lansdown’s Bristol headquarters. There were also demands for its bosses to give up their lucrative bonuses – and today they are expected to bow to pressure.
As the investment company publishes its yearly financial results, it is understood the firm will also reveal that chief executive Chris Hill, finance chief Philip Johnson, research director Mark Dampier and investment boss Lee Gardhouse are taking no bonus this year.
Mr Hill was in line for up to £2.1million and Mr Johnson as much as £1.5million, with Mr Dampier’s and Mr Gardhouse’s pay not disclosed.
The under-fire executives had previously only committed to delaying any bonus payments until after savers could get their money back from Mr Woodford’s fund.
But a source said Mr Hill, 48, has since decided he will instead forgo his bonus entirely, prompting his colleagues to follow suit.
The chief executive has already issued a grovelling apology to Hargreaves Lansdown clients, saying the firm shared their ‘disappointment and frustration’. Yesterday a source said the decision to give up the bonuses was an attempt to acknowledge the impact of Mr Woodford’s fund closure on 300,000 Hargreaves Lansdown customers.
The source added: ‘Chris believes this is the right thing to do.’ Mr Woodford blocked withdrawals from the fund on June 3. He made the drastic move after pumping billions of pounds into risky investments that were hard to sell in a hurry. He said he needed more time to drum up cash that could be used for refunds.
However, the scandal has prompted criticism of Hargreaves Lansdown, which stood by Mr Woodford right up until the suspension.
The investment platform kept Mr Woodford’s Equity Income Fund on a ‘Wealth 50’ list of recommended investments – a crucial guide used by Hargreaves Lansdown’s 1.1million customers – up until the point where withdrawals were blocked.
Mr Dampier, 62, and Mr Gardhouse, 45, have come under particular scrutiny for their roles in the fiasco.
The Mail previously revealed that Mr Dampier has known Mr Woodford for 25 years and promoted his interests by posting interviews with him online.
Just weeks before the Equity Income Fund was closed, Mr Dampier told Hargreaves customers: ‘This isn’t the first time... Neil Woodford’s underperformed. We think he’s still got the skill to deliver excellent long-term performance.’
Mr Gardhouse is responsible for the part of Hargreaves Lansdown that has helped to channel its clients’ money into Mr Woodford’s investments through so-called multimanager funds. Comment – Page 16
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