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Fund manager bill for split-cap fallout passes £100m

Aberdeen Asset Management’s bill for the split-cap trusts debacle has soared passed the £100m barrier after it was revealed that the firm had to pay £30m to settle a dispute with one of it’s former trusts.

The Real Estate Opportunities Investment Trust sacked Aberdeen as manager of its income portfolio back in 2003, without notice, after the value of the fund evaporated. This was followed by the REO board mounting a legal claim to win £80m in compensation from Aberdeen and its broker UBS. The wranglings continued for some two years, with Aberdeen launching a counterclaim against the firm.

Aderdeen announced last week that the group has reached a settlement with the firm totalling some £30m after existing provisions and tax. The group also reiterated that the decision was not an admission of liability but one made by the board in the best interests of the group and the shareholders.

REO has revealed in a statement that the net effect of the settlement would bolster the funds assets to £49.7m (19.6p a share), a figure which does include the release of provisions put aside for Aberdeen’s counterclaim.

Aberdeen has also settled a claim with Treasury Holdings, who managed the property component in the trust, for an undisclosed fee. REO is still chasing UBS.

Aberdeen has made a number of settlements in the wake of the scandal already, including a £35m contribution to the split-capital compensation fund and a £39m compensation bill to investors in its progressive growth fund. Schroders is to launch a global equity income fund which opens to investors on 18th May 2007.


Scot Life creates worksite marketing role

Clare Thomson has joined Scottish Life to the new role of workplace marketing manager within the corporate business team.She will report to head of corporate business Mark Polson, working closely with IFAs to create scheme-specific communication strategies to help advisers and employers communicate pension benefits more effectively to staff.  Thomson will also assume overall responsibility […]

Now SSAS under threat from 82% Asp charges

The Government will retain the crippling 82 per cent tax charges on death benefits for alternatively secured pensions as it announces a wider crackdown on inheritance tax avoidance in pensions.A Budget consultation paper on inheriting taxrelieved pension savings proposes imposing similar charges used with Asps on small self-administered schemes set up to pass on death […]

BUDGET REACTION: BBA warns Chancellor’s gifts may be false

The British Bankers’ Association has accused the Chancellor of ‘giving with one hand and taking away with the other’, in his final Budget.Chief executive Angela Knight says Gordon Brown has announced a significant number of tax changes which need to be analysed.But she says when the “dust settles” it will show any benefits from the […]

Budget 2007: Technical Connection Budget Commentary

In what will probably be his last Budget, Gordon Brown saved the best for last – a reduction in basic-rate tax to 20 per cent in 2008/09 backed up by measures increasing general tax allowances and personal reliefs.


Guide: what you need to consider for your auto-enrolment project

In this guide, Johnson Fleming reveals what items you need to understand to gauge the impact of auto-enrolment on your business. The guide focuses on: the impact that your auto-enrolment scheme will have on you; assessing your workforce; understanding your staging date; reviewing your current provision; and modelling contribution levels and costs.


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