The sell-out of private savers: Hargreaves Lansdown behaves as if it were guiltless in the Woodford affair, says ALEX BRUMMER
The insouciance of Hargreaves Lansdown over the investment platform’s connivance in the Neil Woodford affair is scandalous.
The founders and biggest investors, Peter Hargreaves and Stephen Lansdown, were nowhere to be seen at the firm’s Bristol annual general meeting.
Nor, for that matter, was soon-to-retire research director Mark Dampier, the cheerleader for the blocked Woodford funds. He and his family collected £6million in June from share sales just ahead of the balloon bursting.
Hargreaves Lansdown’s founders and biggest investors, Peter Hargreaves (pictured) and Stephen Lansdown, were nowhere to be seen at the firm’s Bristol annual general meeting
All the noise at the AGM came from disgruntled Hargreaves private investors, with the big institutional holders such as Blackrock nowhere to be seen.
Big battalion investors should have recognised that for all the hand-wringing by HL chief executive Chris Hill, the firm has delivered a huge wound to Britain’s savings culture.
There is no escaping the fact that while Lansdown and Dampier have enriched themselves through share sales, the quarter of HL’s investors exposed in one way or another to Woodford funds have been disastrously let down.
That a further 35,000 investors have signed up to HL since the imbroglio emerged is tragic.
They should be aware that the analysis behind its Wealth 50 Report is pathetically weak and that they are often directed to the kind of momentum funds which could be smashed in a prolonged downturn. Moreover, choice is decided as much by fee discounts as forensic analysis.
The only people getting really rich by following HL recommendations are the company grandees, thanks to its fantastical profit margins in the financial sector in which low interest rates have damaged earnings elsewhere.
Many of those rendered vulnerable by HL’s faulty research and analysis are people who trusted the group with pension fund savings after then chancellor George Osborne removed the obligation to buy an annuity.
They have gone from the frying plan into the fire. The anger and frustration over the way in which Woodford has collected £8million in fees while gating their life savings is palpable.
HL did suspend its own management fees for handling Woodford funds.
That is the very least it could have done. It has hurt savers of all ages, and behaved as if it were guiltless in the most perturbing episode in modern fund management.
Conventional wisdom that retail is dead needs challenging.
It is doubtless the case that the toxic combination of business rates, upward-only rent reviews and digital spending is reshaping shopping.
But a High Street presence on the right terms, and offering a good experience, still has value.
When I was in Washington DC in the summer, it was uncomfortable to see that adjacent to where a defunct Barnes & Noble bookstore once stood there is now an attractive Amazon store with books on current affairs, politics and biography – as you might expect in the US capital.
Here in Britain HMV, now Canadian owned, is showing the same faith in Birmingham with a sizeable new store offering vinyl, CDs and a gig experience.
Privately-owned Sunderland-based Hays Travel is seeking to prove the High Street travel agent is not dead by buying 555 of Thomas Cook’s stores. BT is planning to rebadge some of its EE mobile stores to offer better fixed-line and broadband service.
As one set of tenants moves out, new occupants eventually move in.
In fashionable Fulham, west London, what was until recently M&S has become Pure Gym, which is also moving into a former Topps Tiles outlet a few miles away in Richmond.
Fashionable fitness-wear brand Lululemon has engaged a leading UK commercial property agent to colonise Britain.
It has already opened several locations in central London and is in the prowl for more across the country. Knightsbridge department store firm Harvey Nicks is doing fine in elegant locations in Leeds and Manchester.
Swish bakery chain Gail’s is expanding like billy-o. So, for that matter, is Newcastle-based mass market baker Greggs.
With creative thinking and better experiences, it is possible to resist a negative narrative.
Amid the gloom about the direction of the economy, film is a shimmering star. Latest growth data shows that over the last two years movie production soared by 27.4 per cent.
It was the main factor behind a services recovery in the last three months.
May the force be with you.