One of the UK's prolific fund managers, Terry Smith of Fundsmith, has sued Barclays bank for £220,000 over accusations that the bank caused him to lose investment gains when the bank delayed his request for a money transfer.
Terry Smith, the CEO and founder of Fundsmith Equity Fund, is claiming that Barclays negligently processed his request of a £330,000 transfer from his investment company, Aethelflaed Investments, into his investment fund. City Wire reported that the delay of the transfer, which dragged for almost three years, resulted in him missing out on an investment opportunity that would have doubled his profits.
At the time of the initial transfer request, Smith was the CEO of broker company, Tullett Prebon. He asked Barclays to move £330,000 from his Aethelflaed Investment fund to the Fundsmith Equity in September 17, 2012. According to the Daily Mail, he contacted the bank again five days later, on September 23, when the transfer had not been carried out.
Back in 2012, if the transfer had been made immediately, Smith would have been able to invest on a unit of the fund which was worth £1.28. But by July 2015, when the transfer was finally made, the cost of one unit in the fund had risen to £2.13, increasing by 166 percent. The Daily Mail added that investment would have profited £219,049 had the transaction been carried out that time.
But Barclays is denying Smith's claims. The spokesperson of Barclays stated in a report by Fundstrategy, that Smith was "contributorily negligent in failing to make the payment order in a branch with identifications as it [Aethelflaed] was required to do."
"We cannot comment on a matter which is currently in litigation, save to confirm that we will be vigorously defending this case," Barclays added.
However, Barclays admitted in the Daily Mail that that while Smith did email, with headings 'Ground Control to Major Tom', Smith had sent them to incorrect addresses. Barclays was able to inform Smith that the bank was unable to act on the emailed instructions for the transfer.
