FCA reasserts proposed Woodford redress is 'subset of total losses' as sanction decision delayed

LFSL liability for liquidity mismanagement

The Financial Conduct Authority has clarified that its calculated £298m redress amount for investors in the former Woodford Equity Income fund represents a “subset of total losses", rather than the total figure lost during its final years and closure.

Meanwhile, the decision whether or not to sanction the scheme has been pushed into February at the earliest. Speaking on behalf of the regulator at the second day of the sanction hearing (19 January) of the proposed scheme of arrangement, which was passed last month by a large majority of creditors who voted, Tom Smith KC confirmed the FCA regards the £298m redress figure, of which investors may see up to £235m if the scheme is sanctioned, as only a "subset of the total losses" suffered by investors. Remaining Woodford fund assets shrink 40% since last distribution revealed Smith a...