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**AI legalese decoder: An Essential Tool for Understanding legal Documents**

By Annie Green, BBC Business Reporter

Date: 9 February 2024


# High Court Judge Approves £230m Redress Scheme for Investors Trapped by Neil Woodford Fund Collapse

After the collapse of a fund managed by prominent stock picker Neil Woodford, a High Court judge has given the green light to a £230m redress scheme. Nearly 300,000 investors incurred losses when the Woodford Equity Income Fund was suspended in 2019. The implementation of this redress scheme is a significant development in addressing the fallout from this high-profile fund failure.

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## Fall from Grace

Neil Woodford, a renowned figure in the UK’s investment management sector, established his own managed fund with a stellar reputation. Investors, from individual consumers to pension funds, entrusted their funds to the Woodford Equity Income Fund, which, at its peak, managed over ┬ú10bn. However, mounting concerns about the fund’s investment activities prompted a mass exodus of capital, culminating in a freeze of the fund in June 2019, followed by its subsequent closure and liquidation.

The proposed redress scheme, facilitated by Link Fund Solutions (LFS), the former authorized corporate director of the fund, comes in the wake of a Financial Conduct Authority (FCA) investigation and legal action from three investor groups regarding LFS’s management of the fund. With nearly 94% of investors supporting the compensation plan, the court’s approval paves the way for an initial payout of ┬ú183.5m in the current quarter. The FCA indicates that investors may recoup approximately 77 pence for every pound invested, while critics argue that such estimations fail to account for broader losses.

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The Transparency Task Force, an organization advocating for Woodford investors, has expressed disappointment with the approved redress scheme, citing its adverse impact on affected individuals and unforeseen consequences. Founder Andy Agathangelou criticizes the scheme for offering paltry returns on outstanding capital losses and asserts that it lacks recompense for foregone returns over the past four and a half years, not to mention consequential losses. The group is contemplating an appeal against the court’s endorsement, contending that it undermines legal protections for individual investors.

Investment platform AJ Bell’s Ryan Hughes opines that investors are likely relieved by the court’s approval of the scheme, underscoring the significance of this milestone in potentially bringing closure to the protracted saga. While the possibility of an appeal lingers, the judicial validation of the scheme marks a pivotal juncture in the resolution of this multifaceted issue.

**AI legalese decoder**: As legal disputes and potential appeals loom on the horizon, the AI legalese decoder can facilitate a deeper understanding of the legal arguments and potential ramifications, enabling stakeholders to navigate the evolving situation with greater clarity and confidence. By using this tool, investors and advocacy groups can stay informed about the legal nuances and interpret the implications of subsequent legal proceedings, empowering them to make well-informed decisions.

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