FCA approaches JFSC over new Woodford business

Posted: 19/02/2021

UK watchdog the Financial Conduct Authority (FCA) has been in touch with the Jersey Financial Services Commission following reports that investor Neil Woodford’s new business will operate out of Jersey and Buckinghamshire.

The FCA is still investigating the collapse of the LF Woodford Equity Income Fund and investment company in 2019, but in a recent interview with The Telegraph, Woodford said he was planning to launch a new investment firm, Woodford Capital Management (WCM) Partners, based in Jersey.

In a statement on the FCA's website, Mark Steward, its Director of Enforcement and Market Oversight, said: “There are reports that Woodford’s future business proposal may operate out of Jersey. We are in contact with the JFSC and agreed with them that we will both share information on any application made in our respective jurisdictions – for both a fund or entity."

WCM Partners' focus is likely to be the potentially illiquid holdings that caused problems for the fund manager in 2019, according to reports, but retail investors will not be given access to the vehicles.

Steward added: “Since April 2020, when it varied its permissions, Woodford Investment Management is no longer able to offer investment services to retail clients. 

"Woodford’s new business, WCM Partners, would need to apply for appropriate permissions before commencing any regulated activity in the UK.

“In taking any decision on whether to authorise a firm, we consider whether it is ready, willing and organised to comply, on a continuing basis, with our requirements and standards. That includes, for example, the sustainability of the firm’s business model and the fitness of its management."

The JFSC said in a statement: "We are disappointed to see this announcement in advance of either receiving or processing any application from this company for authorisation to conduct licensed business as an investment management firm in Jersey.

"It would be normal practice when making such an announcement to make it clear that it is ‘subject to regulatory approval’.

"Although the trading name ‘WCM Partners’ has been reserved in the Jersey Registry, no application has been received or processed to authorise WCM Partners to operate as a Jersey company or an authorised investment management firm in Jersey."

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