Neil Woodford and his business partner Craig Newman shared a £1.5m payout just months before their investment empire imploded
Fallen fund manager Neil Woodford and his business partner Craig Newman shared a £1.5m payout just months before their investment empire imploded.
The pair took out the generous dividends from Woodford Investment Management over April and May 2019, new accounts showed.
But weeks later, in June, Woodford’s flagship £3.7billion fund was suspended, and is being wound up as savers suffer losses. Dividends were usually split between Woodford and Newman to reflect the proportion of the firm they own, giving Woodford £975,000 and Newman £525,000.
Fallen star: Neil Woodford and his business partner Craig Newman shared a £1.5m payout in 2019
Sources close to the pair said there was ‘no visibility’ that the fund would be suspended when they received the money.
But even in May 2019, Woodford investors were leaving. And in the year to March 2020, which included the two months during which the pair pulled out their dividends, Woodford Investment Management made a loss of £6.2m compared with a profit of £16.3m in the previous 12 months. In the accounts, Newman said this was ‘below expectations’. Jason Hollands, of wealth manager Tilney, said the payout was an ‘extraordinary move’.
He added: ‘For savers it’s another piece of news that will make them feel quite bitter. He may not have known that the fund was going to be suspended, but the performance had been terrible.’ During the six years that Woodford and Newman ran their firm, they extracted around £113m in dividends and shares of profit. Woodford received around 65 per cent of this.
Earlier this year he announced he was launching a new firm despite being under investigation by the Financial Conduct Authority.