The Financial Conduct Authority (FCA) has contacted the Jersey regulator following Neil Woodford’s announcement he would launch an offshore fund business.
The disgraced manager infuriated investors after he said on Saturday he was preparing to roll out a Jersey-based biotech fund despite the FCA’s ongoing investigation into the events that led to the collapse of his investment empire in 2019.
Investors in his funds are now expected to lose around £1bn of the cash he managed and may have to wait several more months for a final payout.
Mark Steward, the FCA’s director of enforcement and market oversight, said: ‘We are in contact with the Jersey Financial Services Commission and agreed with them that we will both share information on any application made in our respective jurisdictions.’
The regulator is currently investigating Woodford’s administrator, Link Fund Solutions, as well as Northern Trust, which acted as the depositary. But disgruntled investors have criticised the amount of time the probe has taken.
‘The investigation is being appropriately resourced and is progressing, though there has been some impact on accessing certain documents and witnesses during the pandemic,’ Steward said.
‘It is important to note that any comment about the scope of this ongoing investigation is purely speculation; we have not confirmed who or what we are investigating, though it is public knowledge that there were a significant number of entities in the chain of operation of the fund.’
This also comes after Gina and Alan Miller, the founders of wealth firm SCM who came to prominence as anti-Brexit campaigners, wrote to the Treasury select committee on Tuesday asking for an independent investigation into Woodford and the FCA.
Woodford was sacked from his flagship Equity Income fund by Link less than two years ago. That followed a run of poor performance as a string of bets on illiquid, unlisted companies turned sour, leaving investors unable to withdraw their money for months. At the time of gating, £3.6bn of investor cash was trapped in the fund.
‘I recognise the time taken to investigate causes frustration among those affected by a firm or fund failure and who are, understandably, looking for answers. They rightly look to us to provide those answers,’ Stewart said.
As a result of Link’s possible involvement in the Woodford debacle the watchdog is also carrying out a separate probe into the authorised corporate director market, which is yet to complete having been delayed by a year.