Hargreaves Lansdown chiefs in £6m share sale: High-flyers cashed in weeks before Woodford crisis sent stock tumbling
Two high flyers at Hargreaves Lansdown sold millions of pounds of shares in the company just weeks before its ties with troubled fund manager Neil Woodford caused the stock to tumble.
The financial services group’s research director Mark Dampier, his wife Annette, and the firm’s chief investment officer Lee Gardhouse sold shares worth £6.1million last month.
The move will enrage investors in Woodford’s £3.7billion Equity Income fund, who were frozen out of their nest eggs this week after years of dismal performance.
In the money: Hargreaves Lansdown’s research director Mark Dampier and his wife Annette, sold shares last month
Hargreaves Lansdown, which allows savers to invest in funds through its online platform, has been one of Woodford’s biggest supporters.
Dampier, 62, oversaw the firm’s Wealth 50 best-buy list, which is closely followed by many savers looking for funds to invest in.
Woodford Equity Income remained on the list despite a dreadful performance that saw it fall 17 per cent in three years.
It was only removed from the list after the fund suspended trading on Monday.
Just last month, Dampier predicted Woodford was set to turn a corner.
In a note to clients, he said: ‘This isn’t the first time in his career Neil Woodford’s underperformed.
Cashing in: Hargreaves chief investment officer Lee Gardhouse
‘We’ve stuck with him during difficult times before, and in the past investors have been rewarded for such patience.
Our analysis of Woodford’s long-term track record gives us the confidence to retain the Equity Income fund on the Wealth 50, and we think he’s still got the skill to deliver excellent long-term performance.’
But on May 16, days after the note, Dampier sold £600,009 worth of Hargreaves Lansdown shares as they hit their highest-ever price.
His wife Annette sold £5million worth.
Gardhouse, 45, sold £546,710 worth of shares on May 15.
He oversees Hargreaves Lansdown’s Multi Manager funds, which have ploughed £620million of investors’ money into Woodford Equity Income.
…and founder scooped £171m days later
By LUCY WHITE
The co-founder of Hargreaves Lansdown sold more than £170m of shares in the firm two weeks ago.
Stephen Lansdown, who set up the fund supermarket with Peter Hargreaves in 1981, offloaded 7.5m shares on May 22. The 66-year-old got 2280p for each share, earning him a total of £171m.
Lansdown, who no longer works for the company, still has a 9.3 per cent stake worth £839million at last night’s closing price of 1900p.
Honours: Lansdown is joined by his family to pick up his CBE at Buckingham Palace
The share sale triggered speculation that the billionaire, who is married with two children, could spend the money on his sports interests.
The tycoon is the majority shareholder in Bristol City Football Club, Bristol Bears Rugby Club and the Bristol Flyers basketball team.
Lansdown’s business partner, Hargreaves, 72, has a 32 per cent stake in the company worth £2.9billion.
Hargreaves Lansdown shares peaked at close to £25 last month shortly before Lansdown made his sale.
They have since tumbled to £19 each as the company is dragged into the crisis engulfing fund manager Neil Woodford.
The company has long been a supporter of Woodford, despite his recent poor performance, and only removed his troubled Equity Income fund from its Wealth 50 list this week after it barred savers from withdrawing their cash.
Lansdown was ranked 83rd on the Sunday Times Rich List which put his fortune at £1.72billion. Hargreaves was 48th with £3billion.
Lansdown has previously sold more than £500million of shares in the company, using some of the cash to fund his interests in sports clubs in Bristol, where the financial services firm is based.
He was awarded a CBE in the 2017 Birthday Honours for services to business and the community of Bristol.
Lansdown stepped down as chairman of Hargreaves Lansdown in 2009 and left the company’s board in 2012. He relocated to Guernsey in 2010.
Hargreaves Lansdown shares have tanked since the crisis erupted. They are down 16 per cent this week, wiping £1.7billion off the firm’s value. They fell another 4 per cent, or 81.5p, to 1900p yesterday.
Since peaking at 2447.3p in May, when Gardhouse and the Dampiers sold their shares, the stock has fallen 22 per cent, reducing its value by £2.5billion.
This means that, between them, the trio have dodged losses of more than £1million.
MPs launch inquiry as fund refuses to cut its fees
Defiant Neil Woodford has refused to cut management fees for savers who have been locked out of their nest eggs.
The embattled fund manager’s firm said the charges were ‘unchanged’ despite mounting anger over hundreds of thousands of pounds he is raking in.
The 59-year-old is facing probes by Parliament and City regulators over the crisis at his fund management empire.
The chairmen of both the Treasury and work and pensions committees said they would look into the affair, which has left Woodford fighting for his reputation.
Nicky Morgan, chairman of the Treasury committee, also joined the calls for Woodford to hand back management fees being charged to customers who cannot get their cash out of his fund.
Her intervention came after the Mail revealed the fund manager is making nearly £100,000 per day from the charges.
‘The suspension of trading has provided Mr Woodford with some breathing room to fix his fund,’ the Tory MP said. He should afford his investors the same space and waive the fund’s fees while the fund is suspended.’
Frank Field, chairman of the pensions committee, added: ‘We will be looking at this to see to what extent this is an area for our committee, or the Treasury Committee. We should be looking at it.’
Morgan said initial probes would focus on the response from the Financial Conduct Authority – which is examining Woodford’s ban on withdrawals – and the Bank of England. However, John Mann, of the Treasury committee, said Woodford should be called in to face questions as well.
To add to the pressure on Woodford, the Bank of England also signalled it was watching the situation.