Following the winding up of the Leveraged Income Fund Ltd, the Jersey Financial Services Commission pledged to look into split caps. However, JFSC director, Richard Pratt revealed last week that the regulator was 'still considering' whether mis-selling of the risky fund type had taken place.

Speaking to the JEP on condition of anonymity this week, one outraged investor asked:

'What is our local regulator doing? Why is Aberdeen [Asset Managers Ltd, which managed the collapsed fund] still allowed to carry on looking after millions of pounds of other people's money? Surely the reason the Commission exists is to make sure businesses are squeaky clean, yet they seem to be doing nothing about this. It's doing the Island's reputation no good at all. People have lost millions.'

The UK's financial services regulator, the FSA also recently came under fire for being 'asleep on the job' when the magic circle of split capital investment trusts, all heavily invested in each other, began to crumble.

However, according to the Jersey Evening Post, Mr Pratt has hit back at accusations of inactivity on this issue, arguing that the actual cross-selling would have taken place in London, not Jersey, and that therefore allegations that the investments were mis-sold to Jersey investors are the JFSC's number one priority.

'We are pursuing the matter vigorously,' he explained. 'A lot of investors lost money but that does not mean that someone has done something wrong. That could be the case, and if so we might be pursuing regulatory sanctions. But it would not be right to take action in anticipation.'