Treasury select committee chair Nicky Morgan has written to Hargreaves Lansdown chief executive Chris Hill with a host of questions around its links to the Woodford Equity Income fund.
The fund appeared on the platform’s Wealth 50 list before its suspension last week, and Hargreaves had been a bullish supporter of Woodford, even as other criticised his performance and methodology.
There are nine questions in Morgan’s letter to Hill, covering the process behind the Wealth 50 list and the platform’s relationship with Woodford.
Hargreaves issued a statement recently saying that it had been engaging with Woodford regarding illiquid stocks in his portfolio.
Morgan asks for clarification on exactly when concerns were raised and whether discussions are still ongoing after the suspension.
She also asks Hargreaves to detail how many of its customers hold Woodford and the average size of their investment.
In terms of its inclusion on Hargreaves Wealth 50 list, Morgan says her committee of MPs wants to know how often this was reviewed, whether the inclusion of funds on the list can be correlated with increased flows into them, and whether a discount was negotiated for the Woodford fund to appear on the list.
She also asks for an account of the fees and commissions earned both from customers investing in the Woodford fund, and for arranging and administering investments on behalf of Woodford if this was the case.
Yesterday, FCA chief executive Andrew Bailey raised the prospect of Woodford potentially waiving fees on the fund, saying he should “consider his position”.
Morgan also says today that she would support such a move.
She says: “The suspension of the fund provided Mr Woodford with some breathing room, so he should afford his investors the same space and waive the fund’s fees while it is suspended.
“Mr Bailey’s comments are welcome; Mr Woodford should now act and waive the fees.”