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Hargreaves Lansdown faces legal investigation over Woodford fiasco

legal investigationLaw firm Leigh Day has received over 500 enquiries from investors within two weeks of announcing its investigation into a potential legal claim against Hargreaves Lansdown over its role in the Neil Woodford fiasco.

Hargreaves Lansdown – which featured Neil Woodford’s flagship equity fund in its top 50 buy list – is being investigated on behalf of investors who lost money following the collapse of Woodford Investment Management.

Solicitors at Leigh Day are considering whether the financial services firm misrepresented the health of the Woodford Equity Income Fund as it continued to recommend it, ultimately leading to significant losses for investors, the law firm said.

The case is being led by Bozena Michalowska-Howells, partner and head of the consumer law team, and solicitor Kamran Voidani.

According to Michalowska-Howells, the investors who have contacted Leigh Day collectively have several million pounds locked in Woodford funds.

“They are very angry that they may have been misled by Hargreaves Lansdown and that significant parts of their life savings and pensions have been lost,” she said. 

“Some are particularly aggrieved because they raised concerns about the fund with Hargreaves Lansdown financial advisors but were told that Woodford remained a sound investment and were persuaded not to withdraw from the fund.”

Another law firm, Slater & Gordon, is also looking into the possibility of legal claims against Hargreaves Lansdown, it has been reported. The financial services firm has been contacted by Funds Europe but nobody was available for comment.

Following the suspension of trading in the Woodford Equity Income Fund (WEIF) in mid-October, authorised corporate director (ACD) Link Fund Solutions has been in talks with several investment managers about the takeover of the fund.

The scandal surrounding its gating raised questions about the role of authorised corporate directors, as well as other governance issues.

Schroders has recently been appointed to manage another fund previously managed by Neil Woodford by the end of this year. The Woodford Patient Capital Trust will be renamed Schroder UK Public Private Trust once the takeover is complete.

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