Aberdeen to be sued over splits
Aberdeen Asset Management is to face legal actions from investors who claim they have lost hundreds of millions of pounds in split capital trusts backed by the fund manager.
Class Law, the solicitor involved in actions against Prudential, Independent Insurance and Royal & SunAlliance, is working with accountants BDO Stoy Hayward and Lord Newby, the Liberal Democrat peer, on a potential action on behalf of investors.
Many of the trusts in the £13bn sector, especially zero dividends, have seen the value of their shares collapse. Some are now insolvent and being restructured. Investors have lost over 99 per cent of their money in some cases.
Stephen Alexander, a partner in Class Law, said he was sure there would be grounds for suing Aberdeen, the largest backer of split capital trusts, and other fund managers.
He said the firm would be looking at whether Aberdeen's literature was misleading, whether it had sold direct to customers using false claims, and whether, if trusts were sold by independent financial advisers, they had made misleading claims. The Financial Services Authority is also investigating the sector.
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