View more on these topics

Investors slam Connaught for warning failure on Tiuta losses

Investors in the £118m Connaught Income Series 1 fund have slammed the asset manager for not notifying them when it discovered bridging lender Tiuta, which used the vehicle as a funding line, had suffered “significant trading losses”.

Last month, Money Marketing revealed investors in the Ucis fund, which was suspended in March, could face losses of 50 per cent. A decision to wind down the fund was made in June. Independent adviser Duff and Phelps says Connaught stands to recover between £46.5 and £53.2m of the £105.5m used to fund Tiuta.

On 8 April 2011, Connaught sent a quarterly report to IFAs stating the risk of equity loss was “low”. However, it failed to mention that Tiuta had informed Connaught in February 2011 that it had suffered significant losses.

Connaught says it posted an updated report on its website on 28 April 2011 which admitted it was made aware of Tiuta’s losses in February 2011 but it was satisfied the fund was “appropriately secured”. The firm has confirmed it did not send the updated report to investors or IFAs.

Connaught declined to comment on why it did not flag up the new report.

Last month, Money Marketing revealed Tiuta made a pre-tax loss of £37.8m in the 18 months to 30 September 2011.

An investor, who wishes to remain anonymous, says: “We would have expected Connaught to notify us if the risk profile in the investment had changed. It looks to us very much like a rather ham-fisted attempt by Connaught, long after the event, to cover its back and make it look like it notified us of the risks at the time, when in fact it did not.”

Yellowtail Financial Planning managing director Dennis Hall says: “If anything significant happens with a listed fund, you have to tell the stockmarket. Being an unregulated fund these rules do not apply. Enough fingers have been burned using these vehicles.”

A Connaught investors’ meeting is being held this week to vote on recovery options.


Zurich pays out in 91% of critical illness claims

Zurich paid out 91 per cent of its critical illness claims in the first six months of the year, which is unchanged from the last six months of 2011. Over the period 411 claims were paid out, with payments totalling £32.7m. The largest single claim paid out was for £1.05m. Around 1.5 per cent of […]

OOC cartoon 130912

Out of context

“Here comes the velvet assassin.” Fidelity Worldwide Investments head of retail John Clougherty on JP Morgan Asset Management head of UK retail Jasper Berens’ superior fashion sense. “It is constipated and needs a laxative.” Liberal Democrat Lord Ben Stoneham on the lack of activity in the UK housing market. “I feel like I am on […]


FOS rules against 3 IFAs who sold Stirling Mortimer funds

The Financial Ombudsman Service has issued one final decision and two provisional decisions against IFAs who advised on the Stirling Mortimer Ucis investments. All three decisions relate to investors who were advised to put money in the Stirling Mortimer No.4 Cape Verde fund. The final decision, issued on 6 September, involved a 54-year-old widow who […]


New regulators to get stronger s166 powers

The Financial Conduct Authority and the Prudential Regulation Authority will have the power to commission expensive past business reviews and bill the firm involved to recoup the cost. The FSA admits these powers could push up costs for firms. The FSA has published a consultation paper today on authorisation and supervision under the new regulatory […]

Certification guide

Guide: how to… certify your pension scheme

Certification is highly complex and surrounded by a minefield of information and auto-enrolment jargon, which can make it very difficult to understand. However, for many employers it is a necessary process that must be executed successfully.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm