Minimum-wage broker's rebel cause

A MAVERICK City broker who believes the conventional fund management industry is an absurd rip-off is setting up a company and paying himself the £4.10-an-hour minimum wage to keep costs down.

Jonathan Compton, 49, a former senior executive at Credit Lyonnais Securities, is raising £3m through a private placing to finance Bedlam Asset Management. He plans to start three retail funds this autumn, promising no gain, no fee and rebates for chronic underperformance.

Although there is no target for funds under management, £50m after 12 months would be 'very satisfactory'. Ultimately, he would like to float on the Alternative Investment Market.

Compton has earmarked £250,000 a year for an advertising campaign to highlight the 'vagaries and uncertainties' of the conventional fund management industry and has hired libel lawyers Mishcon de Reya to fend off expected defamation actions.

He is investing £700,000 of his own money in Bedlam and will have a 22% stake after the capital raising. The two other senior executives will each be paid less than £65,000 until targets are met.