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Brewin admits it gave &#39wrong advice&#39 on split-caps

Stockbroker Brewin Dolphin has admitted to the Treasury select committee split-cap inquiry that it gave the wrong advice but only because it relied on information in split-cap prospectuses.

Brewin chief executive John Hall admitted the firm had received 600 complaints from split-cap victims and had already paid out some compensation.

Of the 10 split-capital trusts that the firm has acted for in the past six years, four have suspended trading. Brewin compliance officer Leanne Boden was unable to produce figures for the total number of clients that the firm has introduced to split-capital investments but estimated that it was “in the thousands”.

Commitee chairman John McFall questioned Brewin Dolphin investment trust specialist David “Dotty” Thomas over whether the difference between the old style split-cap and the post-1999 highly geared split-cap had been made clear to investors. Chief executive John Hall admitted that the two types had not been marketed differently.

Thomas insisted that he had done his job properly and denied he was the godfather of splits, saying that at 67 years old he had merely outlived all his competitors.

Thomas said: “In some cases, we will have given the wrong advice but we could only go on the figures in the prospectuses which showed the levels the funds intended to invest at.”

Hall said that if a “magic circle” existed, he was not aware of it.

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