Final Notice
On , the Financial Conduct Authority issued a Final Notice to Clive Harris Mongelard
1
FINAL NOTICE
To: Clive Harris Mongelard aka Clive Harris aka Clive Lindsey
IRN: CXM01556
Dated: 12 July 2024
ACTION
1. For the reasons set out in this Final Notice, the Authority hereby makes an order,
pursuant to section 56 of the Act, prohibiting Mr Mongelard from performing any
function in relation to any regulated activity carried on by any authorised person,
exempt person or exempt professional firm.
2. The Authority gave Mr Mongelard the Decision Notice, which notified Mr Mongelard
of the Authority’s decision to take the action specified above.
3. Mr Mongelard has not referred the matter to the Tribunal within 28 days of the date
on which the Decision Notice was given to him.
4. Accordingly, the Authority hereby makes the prohibition order set out in paragraph
1 above against Mr Mongelard. The prohibition order takes effect from the date of
this Final Notice.
SUMMARY OF REASONS
5. Following civil proceedings brought by the Authority before the High Court of Justice
(“the High Court”), the High Court ruled that Mr Mongelard was knowingly
concerned in multiple contraventions of sections 19 and 21 of the Act, and of
section 89 of the FSA 2012 by two companies operated as a joint business and
trading as Gemini, that he was deemed to be the director of between 25 January
2015 and 18 November 2015.
6. On 6 May 2020, Mr Mongelard was ordered by the High Court to pay to the Authority
£1,207,050 on a joint and several basis, representing the losses suffered by
investors in respect of their investment into Gemini. Mr Mongelard failed to satisfy
the Order and the Authority made an application to the High Court to petition for
his bankruptcy. A bankruptcy order was made against Mr Mongelard on 6 April
2021.
7. On the basis of the facts and matters set out in this Final Notice, it appears to the
Authority that Mr Mongelard is not a fit and proper person to perform any function
in relation to any regulated activity carried on by any authorised person, exempt
person or exempt professional firm. The adverse findings by the High Court
concerning contraventions of the Act and of the FSA 2012, demonstrate a clear and
serious lack of integrity, such that Mr Mongelard is not fit and proper to perform
regulated activities. In concluding that it is appropriate to impose the prohibition
order, the Authority has had regard to all the relevant circumstances, including Mr
Mongelard’s previous status as an individual regulated by the Authority, and the
severity of the risk posed by Mr Mongelard to consumers and financial institutions
and to confidence in the UK financial system. The Authority considers that it is
appropriate to take this action to advance its consumer protection and integrity
objectives (sections 1C and 1D of the Act, respectively)
DEFINITIONS
8. The definitions below are used in this Final Notice (and in the Annex):
“the Act” means the Financial Services and Markets Act 2000;
“the Authority” means the Financial Conduct Authority;
“the Decision Notice” means the decision notice given to Mr Mongelard on 4 June
2024;
“EG” means the Enforcement Guide;
“FIT” means the Authority’s Fit and Proper Test for Employees and Senior
Personnel, forming part of the Handbook;
“FSA 2012” means the Financial Services Act 2012;
“the Handbook” means the Authority’s Handbook of rules and guidance;
“the High Court” means the High Court of Justice;
“Mr Mongelard” means Clive Harris Mongelard aka Clive Harris aka Clive Lindsey;
“M&O” means Miller & Osbourne Associates Limited (dissolved);
“OPR” means Our Price Records Limited (dissolved);
“RAO” means the Regulated Activities Order;
“RDC” means the Regulatory Decisions Committee of the Authority (see further
under Procedural Matters below);
“the Tribunal” means the Upper Tribunal (Tax and Chancery Chamber);
“Venor” means Venor Associates Limited (dissolved); and
“the Warning Notice” means the warning notice given to Mr Mongelard dated 10
May 2024.
FACTS AND MATTERS
9. Mr Mongelard was previously authorised by the Authority at various authorised
firms as CF21 Investment Adviser between 2003 and 2007, CF30 Customer
between 2007 and 2009 and CF1 Director from 20 February to 17 April 2009. Mr
Mongelard was not authorised by the Authority or otherwise an exempt person
within their meanings under the Act at the time of his involvement with M&O, Venor
and OPR. Mr Mongelard was the director and one hundred percent shareholder of
Venor from 23 September 2014 until December 2015. He, and another individual
(Person X), was responsible for the financial and other operations of Venor. Mr
Mongelard was also a de facto director of M&O.
10. Between 25 January 2015 and 18 November 2015, Mr Mongelard and Person X
arranged for marketing services to be provided to and performed for OPR, using
M&O and Venor, operating as a joint business using the trading name ‘Gemini’. On
6 May 2020, the High Court made findings against Mr Mongelard as follows:
a) Between 25 January 2015 and 18 November 2015, Mr Mongelard was
knowingly concerned in M&O’s contraventions of section 19 of the Act, by
which M&O acted in contravention of section 19 of the Act by making
arrangements under Article 25 of the RAO for investors to acquire shares in
OPR and by advising investors to acquire shares in OPR under Article 53 of the
RAO.
b) Between 25 January 2015 and 18 November 2015, Mr Mongelard was
knowingly concerned in M&O’s contraventions of section 21 of the Act, by
which M&O acted in contravention of section 21 of the Act by making financial
promotions in respect of the fundraisings in OPR.
c) Between 25 January 2015 and 18 November 2015, Mr Mongelard was
knowingly concerned in M&O’s contraventions of section 89 of FSA 2012, by
which M&O acted in contravention of section 89 of FSA 2012 by making false
or misleading statements in respect of the fundraisings in OPR.
d) Between 2 March 2015 and 18 November 2015, Mr Mongelard was knowingly
concerned in Venor’s contravention of section 19 of the Act, by which Venor
acted in contravention of section 19 of the Act by making arrangements under
Article 25 of the RAO for investors to acquire shares in OPR and by advising
investors to acquire shares in OPR under Article 53 of the RAO.
e) Between 2 March 2015 and 18 November 2015, Mr Mongelard was knowingly
concerned in Venor’s contraventions of section 21 of the Act, by which Venor
acted in contravention of section 21 of the Act by making financial promotions
in respect of the fundraisings in OPR.
f) Between 2 March 2015 and 18 November 2015, Mr Mongelard was knowingly
concerned in Venor’s contraventions of section 89 of FSA 2012, by which Venor
acted in contravention of section 89 of FSA 2012 by making and/or causing to
be made false and/or misleading statements in respect of the fundraisings in
OPR.
11. During the civil proceedings, Mr Mongelard admitted that he was knowingly
concerned in the contraventions. Within his judgement, the Judge acknowledged
that Mr Mongelard “did…submit in his closing submissions that he believed that the
statements in the call scripts were accurate”. Whilst the Judge considered it likely
that another individual was the source of at least some of the statements made to
investors, the Judge stated “that does not…absolve Mr Mongelard for all
responsibility for the statements that were being made by M&O and Venor…Mr
Mongelard appears to have taken no steps at all to satisfy himself as to the truth
of the statements that were being made to potential investors. Nor was there any
basis for him to believe the statements…to be true. Rather, Mr Mongelard appears
to have been willing to allow and indeed encourage the call operators he employed
to make entirely unverified statements, with the sole aim of encouraging investors
to subscribe to shares in OPR.”
12. The Judge also noted that whilst Mr Mongelard did not suggest at any point during
the civil proceedings that he believed that M&O and Venor were authorised for the
purposes of section 19 of the Act, he did not make any independent enquiries nor
take professional advice on the requirements of sections 19 and 21 of the Act. Mr
Mongelard therefore embarked upon the venture concerning OPR without getting
any formal advice as to the legality of what he was doing.
13. Mr Mongelard benefitted significantly from his involvement in OPR and personally
received over £145,432. The companies (M&O and Venor) he directed introduced
almost 68% of the 259 investors in OPR.
14. The High Court ordered Mr Mongelard to repay the full sum of the significant
investor losses caused - £1,207,050, with liability held jointly and severally with
Person X. Mr Mongelard failed to comply with the High Court’s Order and a
bankruptcy order was made against Mr Mongelard on 23 March 2021.
LACK OF FITNESS AND PROPRIETY
16. The statutory and regulatory provisions relevant to this Final Notice are set out in
the Annex.
17. FIT 1.3.1G states that the Authority will have regard to a number of factors when
assessing an individual’s fitness and propriety. FIT 1.3.1BG(1) states that among
the most important considerations when assessing the fitness and propriety of a
person is that person’s honesty, integrity and reputation.
18. The facts and serious nature of Mr Mongelard’s conduct, in particular his having
been knowingly concerned in contraventions of the Act and the FSA 2012, and
being the subject of adverse findings by the High Court concerning activities
connected with financial business, demonstrates his lack of integrity. Consequently,
the Authority considers that Mr Mongelard is not a fit and proper person to perform
regulated activities.
19. EG 9.1.1 provides that the power to prohibit an individual will be exercised by the
Authority to achieve its statutory objectives, which include both securing an
appropriate degree of protection for consumers and protecting and enhancing the
integrity of the UK financial system.
20. Taking into account the nature of the conduct Mr Mongelard participated in, the
judgement made against him as a consequence of his participation, and his status
as a former regulated individual, the Authority considers it is appropriate to prohibit
Mr Mongelard from performing any function in relation to any regulated activity
carried on by an authorised person, exempt person or exempt professional firm.
PROCEDURAL MATTERS
21. This Final Notice is given to Mr Mongelard in accordance with section 390(1) of the
Act.
Decision Maker
22. The decision which gave rise to the obligation to give this Final Notice was made
by the RDC. The RDC is a committee of the Authority which takes certain decisions
on behalf of the Authority. The members of the RDC are separate to the Authority
staff involved in conducting investigations and recommending action against firms
and individuals. Further information about the RDC can be found on the Authority’s
website:
https://www.fca.org.uk/about/committees/regulatory-decisions-committee-rdc
Publicity
23. Section 391(4), 391(6) and 391(7) of the Act apply to the publication of information
about the matter to which this Final Notice relates. Under those provisions, the
Authority must publish such information about which this Final Notice relates as
the Authority considers appropriate.
24. The information may be published in such manner as the Authority considers
appropriate. However, the Authority may not publish information if such publication
would, in the opinion of the Authority, be unfair to Mr Mongelard or prejudicial to
the interest of consumers or detrimental to the stability of the UK financial system.
25. The Authority intends to publish such information about the matter to which this
Final Notice relates as it considers appropriate.
Authority Contact
26. For more information concerning this matter generally, Mr Mongelard should
contact Shamma Masud at the Authority (direct line: 020 7066 1653).
Jeremy Parkinson
Enforcement and Market Oversight Division
ANNEX
RELEVANT STATUTORY PROVISIONS
1. The Authority’s operational objectives are set out in section 1B(3) of the Act and
include securing an appropriate degree of protection for consumers (section 1C of
the Act) and protecting and enhancing the integrity of the UK financial system
(section 1D of the Act).
2. Section 19 of the Act provides:
“(1) No person may carry on a regulated in the United Kingdom, or purport to do
so, unless he is-
(a) an authorised person; or
(b) an exempt person.
(2) The prohibition is referred to in this Act as the general prohibition.”
3. Section 21 of the Act states that a person must not, in the course of business,
communicate an invitation or inducement to engage in investment activity unless
they are an authorised person or the content of the communication is approved by
an authorised person.
4. Part 7 Section 89 ‘Misleading statements’ of the FSA 2012 provides:
(1) Subsection (2) applies to a person (“P”) who—
(a) makes a statement which P knows to be false or misleading in a material
respect,
(b) makes a statement which is false or misleading in a material respect,
being reckless as to whether it is, or
(c) dishonestly conceals any material facts whether in connection with a
statement made by P or otherwise.
(2) P commits an offence if P makes the statement or conceals the facts with the
intention of inducing, or is reckless as to whether making it or concealing
them may induce, another person (whether or not the person to whom the
statement is made)—
(a) to enter into or offer to enter into, or to refrain from entering or offering
to enter into, a relevant agreement, or
(b) to exercise, or refrain from exercising, any rights conferred by a relevant
investment.
2. Section 56(1) of the Act provides:
“The [Authority] may make a prohibition order if it appears to it that an individual
is not a fit and proper person to perform functions in relation to a regulated activity
carried on by:
(a)
an authorised person,
(b)
a person who is an exempt person in relation to that activity, or
(c)
a person to whom, as a result of Part 20, the general prohibition does not
apply in relation to that activity.”
RELEVANT REGULATORY PROVISIONS
3. In exercising its power to make a prohibition order, the Authority must have regard
to guidance published in the Handbook and in regulatory guides, such as EG. The
relevant main considerations in relation to the action specified above are set out
below.
The Enforcement Guide
4. The Authority’s policy in relation to exercising its power to issue a prohibition order
is set out in EG.
5. EG 9.1 explains the purpose of prohibition orders in relation to the Authority’s
regulatory objectives.
6. EG 9.2 sets out the Authority’s general policy on making prohibition orders. In
particular—
(a) EG 9.2.1 states that the Authority will consider all relevant circumstances,
including whether enforcement action has been taken against the individual
by other enforcement agencies, in deciding whether to make a prohibition
order;
(b) EG 9.2.2 states that the Authority has the power to make a range of
prohibition orders depending on the circumstances of each case; and
(c) EG 9.2.3 states that the scope of a prohibition order will depend on, among
other things, the reasons why the individual is not fit and proper and the
severity of risk he poses to consumers or the market generally.
7. EG 9.5.1 states that where the Authority is considering whether to make a
prohibition order against someone who is not an approved person, the Authority
will consider the severity of the risk posed by the individual and may prohibit him
where it considers that it is appropriate to achieve one or more of the Authority’s
statutory objectives.
8. EG 9.5.2 provides that, when considering whether to exercise its power to make a
prohibition order against someone who is not an approved person, the Authority
will consider all the relevant circumstances of the case. These may include, but are
not limited to, the factors set out in EG 9.3.2. Those factors include: whether the
individual is fit and proper to perform functions in relation to regulated activities
(noting the criteria set out in FIT 2.1, 2.2, and 2.3); the relevance and materiality
of any matters indicating unfitness; the length of time since the occurrence of any
matters indicating unfitness; and the severity of the risk which the individual poses
to consumers and to confidence in the financial system.
The Fit and Proper test for Employees and Senior Personnel
9. FIT sets out the criteria that the Authority will consider when assessing the fitness
and propriety of a candidate for a controlled function, and may consider when
assessing the continuing fitness and propriety of approved persons.
10. FIT 1.3.1BG(1) states that the most important considerations when assessing the
fitness and propriety of a person to perform a controlled function include that
person’s honesty, integrity and reputation.
11. FIT 2.1.1G states that in determining a person’s honesty, integrity and reputation,
the Authority will have regard to all relevant matters including, but not limited to,
those set out in FIT 2.1.3G.
12. FIT 2.1.3G provides a list of (non-exhaustive) matters to which the Authority will
have regard when determining a person’s honesty, integrity and reputation. These
include:
(2)
whether the person has been the subject of any adverse finding or any
settlement in civil proceedings, particularly in connection with investment
or other financial business, misconduct, fraud or the formation or
management of a body corporate;
(3)
whether the person has been the subject of, or interviewed in the course of,
any existing or previous investigation or disciplinary proceedings, by the
appropriate regulator; and
(10)
whether the person, or any business with which the person has been
involved, has been investigated, disciplined, censured or suspended or
criticised by a regulatory or professional body, a court or Tribunal, whether
publicly or privately.
FINAL NOTICE
To: Clive Harris Mongelard aka Clive Harris aka Clive Lindsey
IRN: CXM01556
Dated: 12 July 2024
ACTION
1. For the reasons set out in this Final Notice, the Authority hereby makes an order,
pursuant to section 56 of the Act, prohibiting Mr Mongelard from performing any
function in relation to any regulated activity carried on by any authorised person,
exempt person or exempt professional firm.
2. The Authority gave Mr Mongelard the Decision Notice, which notified Mr Mongelard
of the Authority’s decision to take the action specified above.
3. Mr Mongelard has not referred the matter to the Tribunal within 28 days of the date
on which the Decision Notice was given to him.
4. Accordingly, the Authority hereby makes the prohibition order set out in paragraph
1 above against Mr Mongelard. The prohibition order takes effect from the date of
this Final Notice.
SUMMARY OF REASONS
5. Following civil proceedings brought by the Authority before the High Court of Justice
(“the High Court”), the High Court ruled that Mr Mongelard was knowingly
concerned in multiple contraventions of sections 19 and 21 of the Act, and of
section 89 of the FSA 2012 by two companies operated as a joint business and
trading as Gemini, that he was deemed to be the director of between 25 January
2015 and 18 November 2015.
6. On 6 May 2020, Mr Mongelard was ordered by the High Court to pay to the Authority
£1,207,050 on a joint and several basis, representing the losses suffered by
investors in respect of their investment into Gemini. Mr Mongelard failed to satisfy
the Order and the Authority made an application to the High Court to petition for
his bankruptcy. A bankruptcy order was made against Mr Mongelard on 6 April
2021.
7. On the basis of the facts and matters set out in this Final Notice, it appears to the
Authority that Mr Mongelard is not a fit and proper person to perform any function
in relation to any regulated activity carried on by any authorised person, exempt
person or exempt professional firm. The adverse findings by the High Court
concerning contraventions of the Act and of the FSA 2012, demonstrate a clear and
serious lack of integrity, such that Mr Mongelard is not fit and proper to perform
regulated activities. In concluding that it is appropriate to impose the prohibition
order, the Authority has had regard to all the relevant circumstances, including Mr
Mongelard’s previous status as an individual regulated by the Authority, and the
severity of the risk posed by Mr Mongelard to consumers and financial institutions
and to confidence in the UK financial system. The Authority considers that it is
appropriate to take this action to advance its consumer protection and integrity
objectives (sections 1C and 1D of the Act, respectively)
DEFINITIONS
8. The definitions below are used in this Final Notice (and in the Annex):
“the Act” means the Financial Services and Markets Act 2000;
“the Authority” means the Financial Conduct Authority;
“the Decision Notice” means the decision notice given to Mr Mongelard on 4 June
2024;
“EG” means the Enforcement Guide;
“FIT” means the Authority’s Fit and Proper Test for Employees and Senior
Personnel, forming part of the Handbook;
“FSA 2012” means the Financial Services Act 2012;
“the Handbook” means the Authority’s Handbook of rules and guidance;
“the High Court” means the High Court of Justice;
“Mr Mongelard” means Clive Harris Mongelard aka Clive Harris aka Clive Lindsey;
“M&O” means Miller & Osbourne Associates Limited (dissolved);
“OPR” means Our Price Records Limited (dissolved);
“RAO” means the Regulated Activities Order;
“RDC” means the Regulatory Decisions Committee of the Authority (see further
under Procedural Matters below);
“the Tribunal” means the Upper Tribunal (Tax and Chancery Chamber);
“Venor” means Venor Associates Limited (dissolved); and
“the Warning Notice” means the warning notice given to Mr Mongelard dated 10
May 2024.
FACTS AND MATTERS
9. Mr Mongelard was previously authorised by the Authority at various authorised
firms as CF21 Investment Adviser between 2003 and 2007, CF30 Customer
between 2007 and 2009 and CF1 Director from 20 February to 17 April 2009. Mr
Mongelard was not authorised by the Authority or otherwise an exempt person
within their meanings under the Act at the time of his involvement with M&O, Venor
and OPR. Mr Mongelard was the director and one hundred percent shareholder of
Venor from 23 September 2014 until December 2015. He, and another individual
(Person X), was responsible for the financial and other operations of Venor. Mr
Mongelard was also a de facto director of M&O.
10. Between 25 January 2015 and 18 November 2015, Mr Mongelard and Person X
arranged for marketing services to be provided to and performed for OPR, using
M&O and Venor, operating as a joint business using the trading name ‘Gemini’. On
6 May 2020, the High Court made findings against Mr Mongelard as follows:
a) Between 25 January 2015 and 18 November 2015, Mr Mongelard was
knowingly concerned in M&O’s contraventions of section 19 of the Act, by
which M&O acted in contravention of section 19 of the Act by making
arrangements under Article 25 of the RAO for investors to acquire shares in
OPR and by advising investors to acquire shares in OPR under Article 53 of the
RAO.
b) Between 25 January 2015 and 18 November 2015, Mr Mongelard was
knowingly concerned in M&O’s contraventions of section 21 of the Act, by
which M&O acted in contravention of section 21 of the Act by making financial
promotions in respect of the fundraisings in OPR.
c) Between 25 January 2015 and 18 November 2015, Mr Mongelard was
knowingly concerned in M&O’s contraventions of section 89 of FSA 2012, by
which M&O acted in contravention of section 89 of FSA 2012 by making false
or misleading statements in respect of the fundraisings in OPR.
d) Between 2 March 2015 and 18 November 2015, Mr Mongelard was knowingly
concerned in Venor’s contravention of section 19 of the Act, by which Venor
acted in contravention of section 19 of the Act by making arrangements under
Article 25 of the RAO for investors to acquire shares in OPR and by advising
investors to acquire shares in OPR under Article 53 of the RAO.
e) Between 2 March 2015 and 18 November 2015, Mr Mongelard was knowingly
concerned in Venor’s contraventions of section 21 of the Act, by which Venor
acted in contravention of section 21 of the Act by making financial promotions
in respect of the fundraisings in OPR.
f) Between 2 March 2015 and 18 November 2015, Mr Mongelard was knowingly
concerned in Venor’s contraventions of section 89 of FSA 2012, by which Venor
acted in contravention of section 89 of FSA 2012 by making and/or causing to
be made false and/or misleading statements in respect of the fundraisings in
OPR.
11. During the civil proceedings, Mr Mongelard admitted that he was knowingly
concerned in the contraventions. Within his judgement, the Judge acknowledged
that Mr Mongelard “did…submit in his closing submissions that he believed that the
statements in the call scripts were accurate”. Whilst the Judge considered it likely
that another individual was the source of at least some of the statements made to
investors, the Judge stated “that does not…absolve Mr Mongelard for all
responsibility for the statements that were being made by M&O and Venor…Mr
Mongelard appears to have taken no steps at all to satisfy himself as to the truth
of the statements that were being made to potential investors. Nor was there any
basis for him to believe the statements…to be true. Rather, Mr Mongelard appears
to have been willing to allow and indeed encourage the call operators he employed
to make entirely unverified statements, with the sole aim of encouraging investors
to subscribe to shares in OPR.”
12. The Judge also noted that whilst Mr Mongelard did not suggest at any point during
the civil proceedings that he believed that M&O and Venor were authorised for the
purposes of section 19 of the Act, he did not make any independent enquiries nor
take professional advice on the requirements of sections 19 and 21 of the Act. Mr
Mongelard therefore embarked upon the venture concerning OPR without getting
any formal advice as to the legality of what he was doing.
13. Mr Mongelard benefitted significantly from his involvement in OPR and personally
received over £145,432. The companies (M&O and Venor) he directed introduced
almost 68% of the 259 investors in OPR.
14. The High Court ordered Mr Mongelard to repay the full sum of the significant
investor losses caused - £1,207,050, with liability held jointly and severally with
Person X. Mr Mongelard failed to comply with the High Court’s Order and a
bankruptcy order was made against Mr Mongelard on 23 March 2021.
LACK OF FITNESS AND PROPRIETY
16. The statutory and regulatory provisions relevant to this Final Notice are set out in
the Annex.
17. FIT 1.3.1G states that the Authority will have regard to a number of factors when
assessing an individual’s fitness and propriety. FIT 1.3.1BG(1) states that among
the most important considerations when assessing the fitness and propriety of a
person is that person’s honesty, integrity and reputation.
18. The facts and serious nature of Mr Mongelard’s conduct, in particular his having
been knowingly concerned in contraventions of the Act and the FSA 2012, and
being the subject of adverse findings by the High Court concerning activities
connected with financial business, demonstrates his lack of integrity. Consequently,
the Authority considers that Mr Mongelard is not a fit and proper person to perform
regulated activities.
19. EG 9.1.1 provides that the power to prohibit an individual will be exercised by the
Authority to achieve its statutory objectives, which include both securing an
appropriate degree of protection for consumers and protecting and enhancing the
integrity of the UK financial system.
20. Taking into account the nature of the conduct Mr Mongelard participated in, the
judgement made against him as a consequence of his participation, and his status
as a former regulated individual, the Authority considers it is appropriate to prohibit
Mr Mongelard from performing any function in relation to any regulated activity
carried on by an authorised person, exempt person or exempt professional firm.
PROCEDURAL MATTERS
21. This Final Notice is given to Mr Mongelard in accordance with section 390(1) of the
Act.
Decision Maker
22. The decision which gave rise to the obligation to give this Final Notice was made
by the RDC. The RDC is a committee of the Authority which takes certain decisions
on behalf of the Authority. The members of the RDC are separate to the Authority
staff involved in conducting investigations and recommending action against firms
and individuals. Further information about the RDC can be found on the Authority’s
website:
https://www.fca.org.uk/about/committees/regulatory-decisions-committee-rdc
Publicity
23. Section 391(4), 391(6) and 391(7) of the Act apply to the publication of information
about the matter to which this Final Notice relates. Under those provisions, the
Authority must publish such information about which this Final Notice relates as
the Authority considers appropriate.
24. The information may be published in such manner as the Authority considers
appropriate. However, the Authority may not publish information if such publication
would, in the opinion of the Authority, be unfair to Mr Mongelard or prejudicial to
the interest of consumers or detrimental to the stability of the UK financial system.
25. The Authority intends to publish such information about the matter to which this
Final Notice relates as it considers appropriate.
Authority Contact
26. For more information concerning this matter generally, Mr Mongelard should
contact Shamma Masud at the Authority (direct line: 020 7066 1653).
Jeremy Parkinson
Enforcement and Market Oversight Division
ANNEX
RELEVANT STATUTORY PROVISIONS
1. The Authority’s operational objectives are set out in section 1B(3) of the Act and
include securing an appropriate degree of protection for consumers (section 1C of
the Act) and protecting and enhancing the integrity of the UK financial system
(section 1D of the Act).
2. Section 19 of the Act provides:
“(1) No person may carry on a regulated in the United Kingdom, or purport to do
so, unless he is-
(a) an authorised person; or
(b) an exempt person.
(2) The prohibition is referred to in this Act as the general prohibition.”
3. Section 21 of the Act states that a person must not, in the course of business,
communicate an invitation or inducement to engage in investment activity unless
they are an authorised person or the content of the communication is approved by
an authorised person.
4. Part 7 Section 89 ‘Misleading statements’ of the FSA 2012 provides:
(1) Subsection (2) applies to a person (“P”) who—
(a) makes a statement which P knows to be false or misleading in a material
respect,
(b) makes a statement which is false or misleading in a material respect,
being reckless as to whether it is, or
(c) dishonestly conceals any material facts whether in connection with a
statement made by P or otherwise.
(2) P commits an offence if P makes the statement or conceals the facts with the
intention of inducing, or is reckless as to whether making it or concealing
them may induce, another person (whether or not the person to whom the
statement is made)—
(a) to enter into or offer to enter into, or to refrain from entering or offering
to enter into, a relevant agreement, or
(b) to exercise, or refrain from exercising, any rights conferred by a relevant
investment.
2. Section 56(1) of the Act provides:
“The [Authority] may make a prohibition order if it appears to it that an individual
is not a fit and proper person to perform functions in relation to a regulated activity
carried on by:
(a)
an authorised person,
(b)
a person who is an exempt person in relation to that activity, or
(c)
a person to whom, as a result of Part 20, the general prohibition does not
apply in relation to that activity.”
RELEVANT REGULATORY PROVISIONS
3. In exercising its power to make a prohibition order, the Authority must have regard
to guidance published in the Handbook and in regulatory guides, such as EG. The
relevant main considerations in relation to the action specified above are set out
below.
The Enforcement Guide
4. The Authority’s policy in relation to exercising its power to issue a prohibition order
is set out in EG.
5. EG 9.1 explains the purpose of prohibition orders in relation to the Authority’s
regulatory objectives.
6. EG 9.2 sets out the Authority’s general policy on making prohibition orders. In
particular—
(a) EG 9.2.1 states that the Authority will consider all relevant circumstances,
including whether enforcement action has been taken against the individual
by other enforcement agencies, in deciding whether to make a prohibition
order;
(b) EG 9.2.2 states that the Authority has the power to make a range of
prohibition orders depending on the circumstances of each case; and
(c) EG 9.2.3 states that the scope of a prohibition order will depend on, among
other things, the reasons why the individual is not fit and proper and the
severity of risk he poses to consumers or the market generally.
7. EG 9.5.1 states that where the Authority is considering whether to make a
prohibition order against someone who is not an approved person, the Authority
will consider the severity of the risk posed by the individual and may prohibit him
where it considers that it is appropriate to achieve one or more of the Authority’s
statutory objectives.
8. EG 9.5.2 provides that, when considering whether to exercise its power to make a
prohibition order against someone who is not an approved person, the Authority
will consider all the relevant circumstances of the case. These may include, but are
not limited to, the factors set out in EG 9.3.2. Those factors include: whether the
individual is fit and proper to perform functions in relation to regulated activities
(noting the criteria set out in FIT 2.1, 2.2, and 2.3); the relevance and materiality
of any matters indicating unfitness; the length of time since the occurrence of any
matters indicating unfitness; and the severity of the risk which the individual poses
to consumers and to confidence in the financial system.
The Fit and Proper test for Employees and Senior Personnel
9. FIT sets out the criteria that the Authority will consider when assessing the fitness
and propriety of a candidate for a controlled function, and may consider when
assessing the continuing fitness and propriety of approved persons.
10. FIT 1.3.1BG(1) states that the most important considerations when assessing the
fitness and propriety of a person to perform a controlled function include that
person’s honesty, integrity and reputation.
11. FIT 2.1.1G states that in determining a person’s honesty, integrity and reputation,
the Authority will have regard to all relevant matters including, but not limited to,
those set out in FIT 2.1.3G.
12. FIT 2.1.3G provides a list of (non-exhaustive) matters to which the Authority will
have regard when determining a person’s honesty, integrity and reputation. These
include:
(2)
whether the person has been the subject of any adverse finding or any
settlement in civil proceedings, particularly in connection with investment
or other financial business, misconduct, fraud or the formation or
management of a body corporate;
(3)
whether the person has been the subject of, or interviewed in the course of,
any existing or previous investigation or disciplinary proceedings, by the
appropriate regulator; and
(10)
whether the person, or any business with which the person has been
involved, has been investigated, disciplined, censured or suspended or
criticised by a regulatory or professional body, a court or Tribunal, whether
publicly or privately.