Investors take action over Woodford fund collapse

A SECOND group of investors have filed a multimillion-pound lawsuit over the collapse of Neil Woodford’s equity income fund, which left more than 300,000 savers nursing losses.

London law firm Harcus Parker has launched proceedings in the High Court on behalf of 1,500 investors, seeking damages of at least £18m against the fund’s administrators, Link Fund Solutions, over its handling of the saga.

The law firm alleges that Link netted millions of pounds in fees but failed to adequately supervise the £3.7bn fund.

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

Link said it will be “vigorously defending” the charges, adding that it acted “in accordance with applicable rules, as well as in the best interests of all investors, and it will continue to do so”.

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

‘I can’t be sorry for the things I didn’t do. I didn’t make the decision to suspend the fund’

was suspended in June 2019 after Mr Woodford, who had built large positions in hard-to-trade shares, was unable to sell assets quickly enough to meet mounting withdrawal requests from investors. The fund was shut in Oct 2019.

The lawsuit comes after Leigh Day filed a similar case on behalf of 12,000 claimants last year.

The law firm alleged Link allowed the fund to hold excessive difficult-to-sell investments, breached regulatory rules in the way it managed the fund and caused significant investor loss.

Daniel Kerrigan, a senior associate at Harcus Parker, said: “Three years on … our clients are disappointed that it has become necessary for them to issue proceedings in order to reclaim their lost investments.”

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

Last year, the former star fund manager lashed out at Link and rejected criticisms of his operating style.

He said: “I can’t be sorry for the things I didn’t do. I didn’t make the decision to suspend the fund, I didn’t make the decision to liquidate the fund.

“As history will now show, those decisions were incredibly damaging to investors, and they were not mine. They were Link’s decisions.”