UK’s financial regulator FCA has fined asset manager Henderson Investment Funds (HIFL) £1.9m for overcharging thousands of retail investors.

More than 4,500 people investing in the company’s Henderson Japan Enhanced Equity Fund and the Henderson North American Enhanced Equity Fund (the Japan and North American Funds) were found to be overcharged.

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In a statement, FCA said that Henderson Global Investors (HGIL), a HIFL appointed investment manager, reduced the active management of Japan and North American Funds in November 2011.

The company notified the institutional investors on the changes and offered to manage the two funds free of charge.

However, the company failed to inform the amendment to the retail investors and continued to charge the same amount of fees for nearly five years.

Overall, 4,713 direct retail investors, 75 intermediary companies and two institutional investors were affected due to the lapses.

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FCA executive director of Enforcement and Market Oversight Mark Steward said: “The FCA requires firms to treat all its customers fairly, not just some customers. In this case, retail investors paid fees for active investment management they did not receive.

“For retail clients, the Japan and North American Funds were in effect operating as ‘closet trackers’ as the fees charged to them were inappropriate given the diminished level of active management.

“The matter is aggravated by the length of time HIFL took to identify the harm being caused to the retail investors and to fix it.”

HIFL has already compensated all affected customers.