Date: 11th March 2020
Author: BETTER FINANCE

Norway*s High Court has ruled against banking group DNB ASA  in what represents a landmark in "closet indexing" cases.

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Norway’s largest financial services group DNB ASA is to pay back the equivalent of millions of euros to investors after the Supreme Court of Norway found for 180,000 individual investors in a class action brought by the Norwegian Consumer Council.

The court found that three mutual funds had not been managed correctly to give investors the best chance of yield.

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Better Finance, a consumer group, called the ruling “historic” after the Supreme Court ordered the bank to repay 350 million Norwegian kroner (€34 million),  adding that DNB’s asset management group was found “guilty of closet indexing”, after the Court found the individuals had a right to a reduction in fees.

Better Finance pointed out that this case also sets a record due to the vast number of participants, and a precedent, in that the practice of closet indexing, “due to a lack of a legal and measurable definition, is particularly difficult to demonstrate”.

Full articles here & here