Hargreaves Lansdown’s boss Chris Hill quits amid claims over the firm’s involvement within the Neil Woodford scandal
- Chris Hill announced he could be retiring from the FTSE100 company after almost six years in charge
- The move got here because the financial services giant faces a lawsuit and the results of a probe by the City watchdog into the Woodford debacle
- Hill, 51, said he was handing over the reins as Hargreaves Lansdown (HL) embarks on its ‘next phase’ of growth
Hargreaves Lansdown’s boss has stepped down just days after lawyers kicked off a claim against the business over its involvement within the Neil Woodford scandal.
Chris Hill announced he could be retiring from the FTSE100 company after almost six years in charge.
The move got here because the financial services giant faces a lawsuit and the results of a probe by the City watchdog into the Woodford debacle.
Chris Hill announced he could be retiring from the FTSE100 company after almost six years in charge
Hill, 51, said he was handing over the reins as Hargreaves Lansdown (HL) embarks on its ‘next phase’ of growth.
If he had stayed to see through this plan, he would have been at HL for a decade, the corporate said. But his successor faces a tricky ride, after litigation company RGL Management filed a claim against HL within the High Court on Friday on behalf of an initial 3,200 investors caught up within the implosion of Woodford’s investment empire.
The lawsuit is the primary to focus on the Bristol-based company, which was considered one of Woodford’s most influential backers. Shares dipped 1.9 per cent, or 15.8p, to 796.6p yesterday.
HL was considered one of the primary businesses to come back under scrutiny when the Woodford Equity Income Fund (WEIF) imploded in 2019. It had really helpful the troubled fund to its customers through its socalled ‘best buy’ list right up until WEIF was suspended in June 2019.
Around 133,000 HL customers were directly invested in WEIF, lots of whom blamed the investment platform for promoting Woodford after they suffered heavy losses.
HL was considered one of the primary businesses to come back under scrutiny when the Woodford Equity Income Fund (WEIF) imploded in 2019
Just weeks before WEIF was shuttered, HL’s now-retired research boss Mark Dampier told customers: ‘We predict [Woodford’s] still got the skill to deliver excellent long-term performance.’
But hundreds more were also not directly exposed to WEIF because they invested in HL’s so-called ‘multi-manager funds’ pots of cash managed by HL which spread customers’ money across quite a lot of really helpful funds, including WEIF.
In total, it is believed around 300,000 HL customers might someway have been exposed to Woodford’s investment empire. Experts criticised HL – founded in 1981 by entrepreneurs Peter Hargreaves and Stephen Lansdown – for recommending WEIF for so long as they did.
For several months within the runup to its collapse, the fund’s performance had been poor – and there have been signs that Woodford was beginning to alter his strategy to take a position in riskier, earlier-stage corporations.
When the fund was eventually closed down on account of the difficulty these issues caused, Hill was forced to apologise to HL customers.
Now the firm’s conduct shall be under scrutiny within the lawsuit brought by RGL – which can also be targeting Link Fund Solutions, the business which was speculated to be supervising Woodford’s management of WEIF.
RGL is pursuing total damages of greater than £100m, and Woodford victims are still in a position to join the case. HL can also be nervously awaiting the final result of the Financial Conduct Authority’s (FCA) probe into the Woodford saga.
Though it has not yet released its report, the FCA has already fined Link after its try and merge with Canadian rival Dye & Durham forced the watchdog to hurry up its judgment. Link shall be forced at hand out as much as £306m of redress to WEIF victims, and pay an extra advantageous of £50m. HL declined to comment on the Woodford probe.
Hill, who initially joined in 2016 as chief financial officer and was promoted to chief executive in 2017, said he had been ‘privileged’ to steer HL during an ‘unprecedented time of change’.
Yesterday, the business revealed it had made revenues of £162.9m within the three months to September, up 15 per cent on the identical time last yr. It also pulled in 17,000 clients over that point and generated £700m of recent business.
James Allen, an analyst at City broker Liberum, said the update ‘shows that underlying trading at Hargreaves continues to be weak, but is greater than saved by higher rates of interest’.
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