Hargreaves Lansdown hit by lawsuit on behalf of Woodford fund investors

theguardian.com:

Hargreaves Lansdown, a top British investment platform, has been hit by a multimillion-pound lawsuit over the failure of fallen star manager Neil Woodford’s equity income fund, which left hundreds of thousands of investors nursing losses.

The claims management firm RGL said it had filed the claim in the high court in London on behalf of an initial 3,200 investors caught up in the scandal against the London blue-chip company, which promoted the former flagship Woodford Equity Income Fund (WEIF).

RGL is also suing Link Fund Solutions (LFS), the fund’s authorised corporate director, and said its claim could top £100m.

“Both institutions have failed [the fund’s] investors,” said Alexander Weinberg, a partner at the law firm Wallace, which is advising RGL. Hargreaves declined to comment and LFS did not immediately respond to a request for comment over the weekend.

LFS has said previously it believed it had acted in accordance with applicable rules and in the best interests of all investors and would vigorously defend itself against claims.

It is the third lawsuit against LFS over the way it handled the fund, which managed billions of pounds before it was suspended amid a political and public outcry in 2019, trapping 300,000 investors and triggering an investigation by the Financial Conduct Authority.

But RGL is the first to also target Hargreaves over its role in the scandal after Woodford, criticised for holding a large number of hard-to-sell illiquid assets, suspended the fund after struggling to meet redemption requests after months of underperformance. It was later closed and is being wound up.

RGL alleges that Hargreaves continued to recommend the WEIF to clients up to the fund’s collapse, despite being aware of liquidity and