Investors 'misled' over Barclays funds

Barclays has misled more investors into buying risky funds, recent evidence suggests.

Company documents highlight concerns over Norwich Union Balanced Distribution, Barclays Dynamic Tracker, and Barclays Dynamic 70 Tracker, which hold £400m of investors' money between them, according to a Daily Mail investigation.

It follows last year's mis-selling crisis when customers were mis-sold Aviva Global Balanced Income and Aviva Global Cautious Income funds. Both quietly had their risk rating increased by the bank in 2007.

Barclays confirmed it re-categorised some funds in mid-2007. Yet documents show they were still describing them as lower risk in late 2007, the Mail reports.

All were 'recategorised' into higher-risk groups without informing investors.

The £346m Norwich Union Balanced Distribution fund had been sold as 'cautious', but was changed to 'balanced' in mid-2007. Almost half is invested in shares, with 30% in property and a quarter in bonds.

In November, the Barclays Dynamic Tracker fund was described as 'balanced' despite being recategorised as ' adventurous' months earlier.

The Dynamic 70 Tracker was still labelled cautious on November 30, 2007, despite being reclassified as balanced.

A Barclays spokesman says: "There was no impact on existing customers - they were still invested in the products which were deemed right for their risk profiles as determined at the time they invested."