Van Eyk concerns raised last year

Perpetual Trust had concerns about the way Van Eyk funds were being managed well before the company struck trouble, its chairman says.

Wednesday, September 24th 2014, 6:00AM

by Susan Edmunds

Van Eyk has been placed into liquidation after four of its funds, invested in an illiquid asset, were frozen.

Perpetual and Van Eyk both arose out of the break-up of PGC – its trust business was restructured into Perpetual Asset Management, Perpetual Trust and Perpetual Portfolio Management in 2009.

Van Eyk then purchased Perpetual Asset Management and Perpetual Portfolio Management in 2013 and Perpetual Trust was acquired by Coulthard Barnes Capital, chairman Andrew Barnes’ private investment company.

Barnes said: “I think the administrators and the regulators will be taking a long, hard look at the activities of that company. All I can say is that, notwithstanding that Van Eyk and Perpetual Trust both came out of PGC, we very much always viewed it as a totally separate entity.”

He said Perpetual Trust had concerns more than a year ago at the way monies were being managed in Van Eyk.

Barnes, who is chairman of minority Van Eyk shareholder AWI, said he had a conflict because of that stake and so the review was carried out by independent directors. AWI had signalled its intentions to take a controlling stake in Van Eyk, before deciding recently that it was no longer a strategic asset.

“The independent directors of Perpetual determined that it would be better if the money was not managed by Van Eyk and we moved the money. So our customers were out of the Van Eyk position [when the liquidation happened]. There was a little bit left, controlled by some advisers but anything we controlled, we moved out. Starting in the middle of last year. It was just that we had concerns about the way in which portfolio construction was happening and the level of controls. It’s the sort of thing we’re obligated to do as a trustee.”

He said Perpetual Trust had historically used Van Eyk funds. “The decision was made way before this arose but now we’re sitting here thinking ‘we were vindicated, actually we were right’. Sometimes it takes bravery to make that sort of call but we took the view it was right and we moved the money.”

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