Jeff Prestidge: Hit for the Woodford debacle? Join these £200m litigators

Having just finished The Litigants, an enjoyable legal thriller by American novelist John Grisham, it seemed quite appropriate to receive a call soon after from litigation specialist RGL.

The call was to update me on the progress of a high court group claim that RGL has brought against FTSE100-listed wealth manager Hargreaves Lansdown for persuading many clients to buy the Woodford Equity Income (WEI) investment fund before of its suspension in June 2019, and subsequent breakup.

The claim is for losses suffered by investors as a result of the investment platform that continues to recommend the fund, managed by Neil Woodford, until the day of its suspension.

This despite concerns within Hargreaves Lansdown that Woodford’s Fund was becoming increasingly illiquid as the manager was forced to dump the most liquid shares to meet a growing wave of redemptions.

RGL’s claim is also for the loss of the opportunity to invest in alternative funds that, in contrast to Wei, would have generated positive returns.

Since I last wrote on this claim just over a month ago, RGL has added another 1,500 claimants to the class action, bringing the total to 6,600. Expect when the claim is handed over to the defendant in the coming months it will be in excess of £200m, with average claims of around £20,000 including interest. Large sums.

Anyone who invested in Wei through Hargreaves Lansdown can get details about joining the claim at WoodfordLitigation.com, regardless of whether they were still holding the fund when the blinds were abruptly drawn. RGL will not impose upfront fees on those who agree to participate in the claim. Only if the claim is successful will you take a portion of the reward.

As the plot of the novel The Litigators highlights, not all group actions are successful. But for many Woodford investors, RGL’s claim remains the last chance for them to make good on the losses they suffered from becoming embroiled in its disastrous fund. So if you are eligible, join.

As for Mr Woodford, the City regulator appears no closer to taking action against him for steering his fund into the ground and leaving investors with huge losses.

As the former fund manager hinted in a self-serving YouTube video last month (much more eye-catching than even the horrible new nicole kidman babygirl), it could be a while before the Financial Conduct Authority takes action against him.

In fact, given the Chancellor of the Treasury’s determination to shake up regulators, Woodford may well survive the FCA.

For the record, Woodford’s latest take on the markets is that China is a furious ‘buy’.

I wouldn’t buy it for love or money.

Saba receives a short roller

Three cheers to Investment Trust Herald shareholders (I’m one of them) for telling hedge fund manager Saba what they thought of his proposal to take control of the £1.2bn fund, run with aplomb for 31 years by Katie by Katie Potts.

To use a somewhat vulgar term that my late mother used frequently, the investors said, ‘B***er Off.’

Last Wednesday, they voted overwhelmingly against all the proposals put forward by Saba at a general meeting that he had requested (in short, proposals to fire the board and replace them with his own puppets before seizing control of the fund).

It means Herald can now continue doing what it does best: extracting investment returns from a global portfolio of smaller technology, media and telecommunications companies. However, Saba, run by New York financier Boaz Weinstein, is not finished yet.

Next month, it will try the same trick on six more investment trusts, starting with shareholder votes at Baillie Gifford, U.S. growth and Keystone’s positive turnaround on Monday week, followed by growth and income at CQS natural resources and Henderson opportunities a day later.

Voting in smaller European companies and Edinburgh around the world will follow on February 5 and 14 respectively.

For private shareholders in these six trusts, please vote against each proposal put forward by Saba. He is nothing more than an asset stripper.

Happy 250th birthday to build societies

Bulective societies are a force for good in this country, and on Tuesday the industry will mark its 250th anniversary with an informal gathering at the famous Ye Olde Cheshire Cheese pub in London.

Deadlines allowed, I will be there to mark the occasion and hear social historian Professor Carl Chinn talk about how building societies helped lay the foundation stones of the property-owning country we have now become. As a Brummie (as Carl is), I am proud that the first society (Ketley’s) was established at the Golden Cross Inn in Birmingham.

Although the building societies, in terms of numbers, are a shadow of what they once were – 42 remain, compared to 382 half a century ago – they still do many things right.

Most are customer-focused and, unlike the big banks, continue to support the high street. According to their trade organisation, the Building Societies Association (BSA), societies now account for 30 per cent of all High Street branches run by them or banks, up from 14 per cent in 2012.

Although this is more a reflection of the Slash and Burn branch strategy adopted by the big banks, the country – by far the biggest player in the industry – has nailed its colors firmly down to the high street until at least 2028.

Smaller societies also play their part in community banking by having branches in cities where the big banks have deserted. The BSA says there are 142 towns in England and Wales that are only served by one building society. Among them is my home town of Wokingham, Berkshire, where Just Nationwide, Fellow Society Newbury and a somewhat chambolic post office at the back of WH Smith now support a rather fragile high street. Both the former branches of Barclays and Lloyds remain empty and scar the town. Shame on them.

While some building societies have barely covered themselves in glory over their handling of late compensation related to the collapse of trust fund firm Philips Trust Corporation (an organization which some of the society’s clients ended after a conversation in a branch), It is a strange stain.

We need to build partnerships on our high streets.

Remembering David Holmes

Speaking of building partnerships, one of their best communicators in the 30 odd years I’ve been following them was David Holmes.

He worked for Yorkshire, based in Bradford, and sadly died earlier this month after a long battle with Parkinson’s. He was 75 years old. David was passionate about Yorkshire and its commitment to doing the right thing for the customer. In many ways, in the 1990s and early 2000s, he helped put society on the map by going out and waving its flag. He was more of an ambassador for mutuality than his CEOs and more of an empty banner for the industry than the BSA.

On more than one occasion, I missed my last train home as a result of munching on CUD (building society) with David over a meal washed down with a decent bottle of wine and a glass or two of brandy.

On Tuesday, at Ye Olde Cheshire Cheese, I’ll raise a glass for David. He would like that very much.

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