The regulator’s findings issued today in a warning notice were, “unprecedented and fundamentally misconceived”, according to a statement from legal firms WilmerHale and BCLP.

The FCA published a warning notice against Neil Woodford and Woodford Investment Management alongside its findings against Link Fund Solutions.

The regulator said that Mr Woodford had a "defective and unreasonably narrow understanding" of his responsibilities for managing liquidity risks.

It also said that he and Woodford Investment Management failed to ensure that the Woodford Equity Income Fund's liquidity risk framework was appropriate, to respond appropriately to the ongoing deterioration in the fund's liquidity and to maintain a reasonable liquidity profile for the fund.

WilmerHale and BCLP said Mr Woodford and his firm will challenge the FCA’s findings, claiming that the only criticisms of Mr Woodford concerned the fund’s liquidity framework which was the responsibility of fund administrator Link Fund Solutions.

The statement also claimed that Woodford Investment Management and Neil Woodford were not given any prior warning about the fund’s suspension.

The warning notices are not the FCA's final decisions. Before making a final decision, Mr Woodford and Woodford Investment Management have the right to make representations to the FCA's Regulatory Decisions Committee.

The FCA has yet to specify what, if any, regulatory action it will take against Mr Woodford and Woodford Investment Management should its final decision rule against Woodford.

The FCA said it would detail its proposed sanctions and its full findings public “at an appropriate point.”

Those invested in the Woodford Equity Income Fund when it was suspended are starting to receive a share of a £230m redress scheme funded by the authorised corporate director of Link Fund Solutions, which was approved by the High Court in February.

Investors have been waiting for five years for the redress scheme after the fund was suspended following high outflows in 2019.

The FCA originally calculated the losses arising from failures in liquidity management to remaining investors as being up to approximately £306m.