Aberdeen Asset pays advisers £11m

ADVISERS to Aberdeen Asset Management, the company at the heart of the split-capital trust scandal, had a fees bonanza last year.

They received multimillion pound payments, even though victims who lost almost all their money in supposedly low-risk investments have so far had no more than £10,000 each in compensation.

The fund manager's latest annual report shows it spent £11.7 million on 'regulatory matters'. The vast majority went to advisers helping the firm to deal with the Financial Services Authority and the Financial Ombudsman Service, which are probing Aberdeen's splitcapital trust business.

One industry expert said: 'You have to ask whether this bail-out was in shareholders' best interests. The company could be accused of throwing good money after bad.'

A source close to Aberdeen said that the sum also included a payment to a hardship fund set up by the investment trust industry, but this is thought to be less than a tenth of what has been spent dealing with regulators.

Aberdeen - led by chief executive Martin Gilbert --and other firms are being investigated for mis-selling and collusion in the splittrust industry.

Splits had two classes of shares with some supposed to produce high yields and others capital growth.

However, cross investment and high borrowing led to huge falls in the value of the funds when share prices fell.