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FCA under fire from MPs over slow Woodford probe

FCA under fire over slow Woodford probe: MPs wonder why nothing has been heard of the inquiry 18 months on

The City watchdog has been told to set out when it will conclude its probe in into the collapse of Neil Woodford’s investment empire.

MPs on the Treasury Committee noted that the Financial Conduct Authority launched its inquiry into the scandal more than 18 months ago – but still nothing has been heard.

And with the disgraced fund manager planning an audacious comeback, committee chairman Mel Stride said: ‘The FCA should set out when we can expect its investigation to conclude.’

MPs on the Treasury Committee noted that the FCA launched its inquiry into the Neil Woodford scandal more than 18 months ago – but still nothing has been heard.

The intervention came as the financial regulator in Jersey said it was ‘disappointed’ that Woodford had announced he was starting a new business WCM Partners on the island without first seeking or receiving authorisation. 

In a further blow to the 60-year-old, Jersey’s minister for external relations, Ian Gorst, last night said: ‘As minister with political responsibility for financial services, I would be dismayed if such a fund were to be authorised before the proper resolution of any outstanding regulatory matters in the UK, which Mr Woodford is subject to.’

The FCA launched a probe after the collapse of Woodford Investment Management in 2019 left thousands of savers nursing heavy losses.

But that has not stopped the once-feted stock picker from outlining plans to resume his fund management career.

Earlier this week, the FCA warned that Woodford’s new firm would need to seek its permission before performing any regulated activity in the UK – and that it would consider the ‘fitness of its management’ before granting approval.

In another blow, the Jersey Financial Services Commission (JFSC), the financial services regulator for the island, said it was ‘disappointed’ that WCM was unveiled ‘in advance of either receiving or processing any application from this company for authorisation’.

The JFSC added: ‘No application has been received or processed to authorise WCM Partners to operate as a Jersey company or an authorised investment management firm in the island.’

Woodford’s downfall began with the implosion of his Equity Income Fund, which locked investors’ money inside in 2019 and is being wound up. 

Stride said: ‘The previous treasury committee was vocal in its concerns regarding the failure of the Woodford fund and the impact on its investors.

‘As the FCA’s investigation still continues over 18 months after the fund was suspended, the reports of the new fund may understandably be of concern to investors who previously lost out.

‘The FCA should set out when we can expect its investigation to conclude.’

Critics including transparency campaigners Gina and Alan Miller, who wrote a letter to the treasury committee this week, are calling for the FCA to face an independent inquiry into its handling of the scandal.

Stride said the committee would ‘consider’ the letter next week when Parliament returns from recess.