Woodford fined £46m and banned from top City roles: Ex-fund manager branded ‘not fit and proper’ by watchdog

The financial watchdog has fined Neil Woodford and his company £46million and banned the disgraced fund manager from holding top City jobs.

The former star stock picker ‘made unreasonable and inappropriate investment decisions’ before his fund collapsed and left thousands of investors trapped, the Financial Conduct Authority (FCA) found.

In a damning verdict, it yesterday hit Woodford with a £5.9million charge and his company with a £40million penalty.

And the regulator said the money manager’s ‘lack of competence, capability and reputation’ meant he was ‘not a fit and proper person’ to hold senior management roles or control retail investor funds.

It comes six years after more than 300,000 investors were left with around £3.7billion stuck in the Woodford Equity Income fund in one of the UK’s biggest retail investment scandals.

The FCA said Woodford ‘did not react appropriately as the fund’s value declined, its liquidity worsened, and more investors withdrew their money’.

Appeal: The Supreme Court has hit disgraced ex-fund manager Neil Woodford with a £5.9mi charge and his company with a £40m penalty

The regulator accused Woodford of holding a ‘defective and unreasonably narrow understanding of his responsibilities’.

Campaigners have urged the Government to strip Woodford of the CBE he received in 2023 for services to the economy.

But in a statement through his lawyers, Woodford said he will fight the decision and blamed the regulator and the fund’s manager Link for the collapse and investor losses. 

The penalty and ban are dependent on the outcome of the appeal process.

At the crux of the scandal was a lump of illiquid investments made by Woodford, meaning they were difficult to rapidly turn into cash.

When investors started pulling out their money, it was the more liquid investments that were sold first to fund the withdrawals.

But that was unfair to those who kept their money invested, because they were left with a disproportionate share of the remaining illiquid assets before being locked out of the fund. 

Woodford Investment Management (WIM) insisted that his new venture – a subscription service that costs up to £840 a year – would not be affected.

A spokesman for WIM and Woodford said: ‘We believe the appeal process will shed much needed light on the events leading to and following the fund’s suspension, including the regulator’s role in those events.’