Woodford investors are set to receive their share of an £185mn payout.
It is the first part of a £230mn settlement scheme for investors trapped in the failed Woodford fund, five years after it closed, with the scheme approved by the High Court in February.
Link, the fund's administrator, confirmed on Monday (March 25) it has made the initial settlement distribution, to the tune of £185.7mn to the Woodford fund.
It said: "Scheme creditors will receive payments in the same way as they have previously received capital distribution payments from the WEIF.
"It will take additional time for scheme creditors who have invested through intermediaries to receive their payments, depending on the time it takes for intermediaries to process distributions."
AJ Bell Investments interim managing director, Ryan Hughes, pointed out the agreed scheme is not without controversy as many investors still think it does not go far enough.
Hughes said: "It’s almost five years since the Woodford Equity Income fund shocked investors and suspended redemptions, locking up over £3.5bn of investments for more than 300,000 investors.
"At that point, few would have thought that this saga would still be rumbling on five years later having seen a long chain of events that has now culminated in investors receiving their first compensation payment from the scheme.
"While this won’t be enough to satisfy many of the investors who have suffered as a resulted of this fiasco, for others it will represent an opportunity to move forward having voted to approve the scheme through gritted teeth recognising that this may be their best chance of receiving some form of redress."
Following the scheme's approval, Andy Agathangelou, founder of the Transparency Task Force, said at the time he was disappointed by the decision.
He said that not all of those affected by the fund’s collapse voted for the compensation scheme.
In April 2023, the FCA announced that Link made ‘critical errors and mistakes’ which ‘caused significant losses for those investors who remained in the fund when it was suspended’.
tara.o'connor@ft.com
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