Courts to invest trust funds
Funds are held in trust by the courts for around 22,000 people, such as minors and wards of court, who have been awarded damages.
Following a major review into the way this money is managed, the Courts Service has appointed top fund managers to decide on how best to invest the money.
Up until now money awarded to minors by the courts as compensation and money held on behalf of wards of court has simply been lodged in a bank account rather than invested in a strategic manner.
However, two of the top asset management firms, Bank of Ireland Asset Management and State Street Global Advisors, will now provide investment management services to the courts.
A spokesman for the Courts Service said the funds would be placed in a range of areas, including the stock market, but insisted it would not be placed in a high-risk setting.
“This is about getting a better return on the funds for people who have been awarded damages in the courts,” a spokesman for the Courts Service said.
The investment for minors will be low risk and low return, but is still aimed at improving on the returns achieved on deposit accounts.
There will a higher risk investment strategy for money held by the court on behalf of adults who are judged to be incapable of looking after their own money.
These adults are deemed wards of court and in some would require medical care over a 20 or 30-year period.
A range of investment strategies have been drawn up which are geared to meet the requirements of individual beneficiaries.
Each individual will have a committee who will help to decide which of the investment strategies are most appropriate, depending on the size of the sum and the amount of time it will be held in trust by the courts.
The sum of €800m is understood to be one of the biggest amounts of money to enter the asset management market this year in Britain or Ireland.
The two asset management firms were chosen following an international tender competition last September.
A computerised accounting system is to be introduced into the Courts Service to replace the existing manual system. The money will also be placed in a central funds office, which will manage all court funds.
The shake-up in the way the Courts Service manages this money is part of a wider drive to modernise the judicial system.
A comprehensive review was carried out by Mercer Investment Consulting and the Courts Service decided that its recommendations should be implemented.
Under the new system, beneficiaries will receive annual account statements.
