Neil Woodford investors told they will be locked out until December
Fury as savers who invested in Neil Woodford fund are told they will be locked out of their nest egg until December as he cashes in £1 MILLION shares
- It was announced that Mr Woodford, 59, was a ‘reluctant seller’ of his shares
- Investors told a block on withdrawals was likely to be extended to December
- Mr Woodford is still charging fees totalling almost £100,000 every working day
Fund manager Neil Woodford sparked further anger last night after cashing in £1million of shares just as his investors were warned they face being denied access to their money until December.
It was announced yesterday that Mr Woodford, 59, was a ‘reluctant seller’ of shares in his Woodford Patient Capital Trust to settle personal liabilities, including a tax bill.
But hours later, investors with money in the separate Woodford Equity Income fund were told a block on withdrawals was likely to be extended to December.
Fund manager Neil Woodford sparked further anger last night after cashing in £1million of shares just as his investors were warned they face being denied access to their money until December
Savers were barred from taking their money out of this fund two months ago after Mr Woodford ran out of ready cash to pay customers who wanted their investments back.
Although savers cannot access their nest eggs, Mr Woodford is still charging fees totalling almost £100,000 every working day. His company is on course to rake in almost £12million before the doors are reopened.
Baroness Altmann, a former pensions minister, said: ‘This situation is a disgrace. I just can’t believe that a fund manager of his long standing is unable to see the distress he is causing.
People invested in what they thought was a first-class fund, their money has basically been taken away from them… and to add insult to injury they’re still being charged fees.
It was announced yesterday that Mr Woodford, 59, was a ‘reluctant seller’ of shares in his Woodford Patient Capital Trust to settle personal liabilities, including a tax bill
‘And then Mr Woodford is suddenly able to get £1million without a problem. It just seems dramatically unfair.’
Mr Woodford sold 1.75million shares in Patient Capital, 60 per cent of his holding with a value of around £1million, between July 3 and 8.
He told the trust’s board only on Saturday, three weeks later.
Investors including Mr Woodford can still buy and sell shares in Patient Capital.
He has a separate holding in Equity Income, which he will be unable to sell until it reopens. Mr Woodford refused to go into detail about the tax bill he sold the shares to pay.
His problems began when he pumped billions of pounds of savers’ cash into risky investments that were hard to sell in a hurry.
At the start of June, he was hit with a demand by customer Kent County Council to repay £263million but was unable to sell enough shares.
Equity Income was forced to block withdrawals and start a massive sell-off.
Link Fund Solutions, an independent company tasked with making sure Equity Income follows the rules, has now told investors this suspension is likely to last until early December for Mr Woodford to complete ‘a measured and orderly repositioning of the fund’s portfolio of assets’.
In a defiant update on his website, Mr Woodford apologised but insisted he will be proved right. He said his investing strategy is based on a view that the world economy is heading for the rocks.
‘Admittedly, this strategy has not delivered the returns we had anticipated over the past couple of years,’ he said.
‘I understand the frustration, inconvenience and anxiety the continued suspension of the fund will be causing.’
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