FSA to investigate Godfrey's 'questionable activities' claim

The FSA is investigating questionable activities by brokers and other companies within the split capital sector following revelations from AITC director-general Daniel Godfrey. Godfrey told the Treasury Committee Inquiry into split capital trusts, chaired by John McFall MP, that he was aware of market-makers selling ex-dividend shares to splits with special cum dividends attached, which increased the sale price by an equal amount. The broker would then rebate the dividend amount to the split, which would declare it as dividend income. This arrangement meant the splits were effecti...