Investment group Hargreaves Lansdown has urged investment manager Neil Woodford to look for alternative ways to return billions of pounds to clients trapped in his suspended flagship fund.

In an online post addressed to Hargreaves customers, the chief executive, Chris Hill, said he was angry the situation was still unresolved and pledged to ratchet up the pressure on Woodford’s investment house.

“We will continue to put pressure on Woodford Investment Management to sell out of their unquoted stocks in the Woodford Equity Income Fund,” Hill said. Those investments are harder to turn into cash to meet customer withdrawals.

“We have also urged Woodford to consider alternative ways to release capital so that investors can get access to their money as soon as possible, while balancing the need to get a fair price for assets,” he added.

Hargreaves Lansdown refused to comment on what alternative measures could help Woodford return cash to clients. But one industry expert, who asked not to be named, said Woodford may be able to split the fund, separating the harder-to-sell assets from its listed stocks. The fund holding the listed stocks could then open to trading.

“In the hedge fund world, funds sometimes create ‘side pockets’ where illiquid and hard-to-sell assets are segregated and ringfenced in a separate share class, so that the ongoing fund that is open to trading is separated from these assets,” the industry insider said. “Any gains from the sale or recovery of these assets would only go to those who were invested at the time the ‘side pocket’ was created.”

Other options suggested by investment experts could include Woodford funnelling his own money into the fund or taking out a loan to pay back investors.

Earlier this week, Hargreaves Lansdown disclosed that more than 290,000 of the firm’s clients – or about one in four of its total customer base – have been hit by Woodford’s decision to halt withdrawals from the £3.7bn Woodford Equity Income Fund on 3 June.

The investment group has been criticised for promoting Woodford’s fund on its Wealth 50 list of favourite investments, despite a string of bad bets that sparked a surge in redemptions and the fund’s eventual suspension. It only removed the fund following that suspension and has since apologised to investors. Hargreaves has also waived its platform fee until the fund reopens, although Woodford has not reduced his management fees.

Profile Who is Neil Woodford? Show Neil Woodford was once the UK’s biggest star fund manager, personally managing a £25bn mountain of money on behalf of pension funds and other investors at Invesco Perpetual. When he decided to quit Invesco and go it alone in 2013 it was a huge shock for the fund management industry. Invesco shares slumped by 7% on the day he announced his departure. At Invesco Woodford held control of huge stakes in some of the UK’s biggest firms, and his opinions mattered. His criticism of AstraZeneca chief executive David Brennan in the 2012 shareholder spring was widely regarded to have cost him his job, and his critique of BAE’s attempted £28bn merger with Airbus is acknowledged as one of the reasons the deal collapsed. Woodford, who was widely referred to in the media as an investment “hero” and fund management “star”, had done exceedingly well over his quarter century there. A £1,000 investment placed when he started at the firm in 1988 would have risen to £23,000 by the time he left. Woodford accidentally fell into fund management and hadn’t heard of the term until he rocked up in the City in the 1980s sleeping on his brother’s floor while looking for a job. He got his first break in insurance, before drifting into fund management. He had left school wanting to fly fighter jets but couldn’t pass the RAF’s aptitude test, and instead read economics and agricultural economics at the University of Exeter. Feeling he had outgrown Invesco Perpetual, he set up his own firm Woodford Investment Management in 2014, on an industrial estate near Oxford. Within two weeks of launching, he had raised £1.6bn, a UK record, and it quickly grew to £16bn. In its first full year his flagship fund returned 16% and Woodford, a devotee of veteran US investor Warren Buffett, was dubbed the “Oracle of Oxford”. Asked if he ever doubted his judgment, Woodford once said: “Daily. You must never, as a fund manager, stick your head in the sand saying ‘everybody go away, I’m right, I’m right, I’m right’. You’ve always got to expose yourself to criticism and the analysis that you may be wrong.” Woodford went on to say that the secret of successful fund management was a balance of arrogance and humility. “You have to have a sufficiently strong arrogant gene to back your judgment, back your conviction. If you didn’t, you would end up with a portfolio that looks very much like the index. But, equally, you must have the humility to accept that you will get things wrong.” Rupert Neate Photograph: Jenny Goodall/Rex Features

“We are angered by the lack of resolution so far but remain actively engaged with the regulator, Woodford, Link and the Treasury select committee to ensure that all investors, not just those invested through Hargreaves Lansdown, are able to access their investment as soon as possible,” Hill said in his post. Link is the fund’s authorised administrator.

A Woodford spokesman said the fund was still working on cutting its exposure to unquoted companies. “This strategy is ongoing. We recognise the concerns of Hargreaves Lansdown and all investors. We are actively engaged with the fund’s authorised corporate director [Link] and focused on getting the portfolio in a position to resolve this situation.”