Hargreaves breaks law on dividend payments

Hargreaves Lansdown has been caught breaking company law on dividends by the Financial Reporting Council and will be calling an extraordinary meeting with shareholders over the issue.

The FTSE 100 broker admitted to failing to file accounts justifying dividend payments, the Financial Times reports. It was caught during a random audit by the FRC.

Chief executive Ian Gorham said the breach was a case of “not submitting a sheet of paper” and that the company now has to go through “bureaucratic hassle” to rectify the situation.

The missing paperwork required Hargreaves to show that they could afford to pay dividends. The special shareholder meeting will now require the broker to propose that shareholders keep their payout.

The admission comes as Hargreaves announces a Brexit boost in its half yearly results, which saw pre-tax profit of £131m driven by higher than normal trading volumes.