Woodford Investors Can’t Leave Hargreaves, Rival Platform Says

LONDON (Capital Markets in Africa) – Investors in Neil Woodford’s frozen flagship fund have been prevented from moving their accounts from Hargreaves Lansdown Plc to other investment platforms, according to a competing firm.

Woodford shocked the financial world last month when he locked the LF Woodford Equity Income Fund after a run of poor performance. About 133,000 clients have invested a total of just over 1 billion pounds ($1.2 billion) in the fund through the Hargreaves Lansdown platform. The Telegraph newspaper reported the news earlier.

The transfers have apparently been blocked because Hargreaves Lansdown customers hold a different share class than clients of other platforms, Richard Wilson, chief executive officer of Interactive Investor Services Ltd., wrote in a letter to the U.K. Parliament’s Treasury Committee.

“We think this is unacceptable,” Wilson wrote in the letter dated July 2 and published on the committee’s website. Investors in Woodford’s fund “have both hands tied behind their back: they can neither exit the fund, nor transfer their assets to platforms which might better suit their needs,” he wrote.

A Hargreaves Lansdown spokesman declined to comment.

Hargreaves Lansdown has come in for criticism for keeping Woodford’s flagship on its list of favorite funds up until he stopped redemptions. It waived its platform fee for the fund, and called on Woodford to do the same. The embattled stock picker hasn’t done so, and continues to pull in about 65,000 pounds a day in management fees while he sells off assets to raise cash.

Source: Bloomberg Business News