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Friday, June 15, 2018

Brexit - do what they do not what they say!

If we needed any more proof that hard-line Brexiteers inhabit a different world to anybody else then the revelation that the City firm co-founded by Jacob Rees-Mogg, has set up an investment fund in Ireland and is warning prospective clients about the financial dangers of the sort of hard Brexit favoured by the Tory MP, must surely count as a slam-dunk..

As the Guardian reports, the London-based Somerset Capital Management (SCM) described Brexit as a risk in a prospectus to a new fund it launched in March, which has been marketed to international investors who want to keep their money in the EU long-term. This is despite Rees-Mogg, who works part time at Somerset Capital in addition to his work as an MP, repeatedly dismissing the concerns of those worried about the financial risks of Brexit. He has argued the UK needs to quit the single market and customs union so the country is not a “rule taker” from Brussels:

But in reference to Brexit, the SCM prospectus warned: “During, and possibly after, this period there is likely to be considerable uncertainty as to the position of the UK and the arrangements which will apply to its relationships with the EU.”

The document continued: “As [the firm is] based in the UK and a fund’s investments may be located in the UK or the EU, a fund may as a result be affected by the events described above.”

Rees-Mogg is a non-executive chair at SCM and is paid about £14,000-a-month for working 30 hours a month there. Earlier on Wednesday, he defended the decision by the investment firm to create a new investment fund in Ireland.

“A number of existing and prospective clients requested domiciled access to Somerset’s products,” he told the Daily Telegraph. “The decision to launch the fund was nothing whatsoever to do with Brexit.”

Rees-Mogg said that SCM had funds based across the world and that “people outside the EU are used to Irish domiciled funds”. The warnings in the prospectus, he said, were “not a policy statement by SCM”, but guidance to investors that was drafted by lawyers.

I suppose we can now draw our own conclusions about Jacob Rees-Mogg's condemnation of scare stories about Brexit.
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