1

NOTICE OF DECISION

To:


LS & VS Johal

ACTION

1.
The Authority has decided to cancel the Firm’s Part 4A permission.

2.
The Authority has taken this action because, based on the facts and matters
set out below, it considers that the Firm is carrying on no regulated activity to
which the Firm’s Part 4A permission relates.

3.
The cancellation takes effect on 18 March 2024. The effect of the cancellation
is that the Firm no longer has permission to carry on any regulated activities.

DEFINITIONS

4.
The definitions below are used in this Notice of Decision (and in the Annex):

“the Act” means the Financial Services and Markets Act 2000;

“the Authority” means the Financial Conduct Authority;

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“EG” means the Enforcement Guide;

“FEES” means the Authority’s FEES Manual, part of the Handbook;

“the Firm” means LS & VS Johal;

“the Firm’s Part 4A permission” means the Part 4A permission granted by the
Authority to the Firm;

“FSCS” means the Financial Services Compensation Scheme;

“the Further Notice” means the further notice issued by the Authority to the
Firm dated 20 February 2024;

“the general levy” means the levy a firm must pay to the Authority towards
the costs of operating the compulsory jurisdiction of the Financial Ombudsman
Service;

“the Handbook” means the Authority’s Handbook of rules and guidance;

“the IML levy” means the Illegal Money Lending levy;

“the Notice” means the notice issued by the Authority to the Firm dated 22
January 2024;

“Part 4A permission” means permission to conduct regulated activities,
granted by the Authority under Part 4A of the Act;

“RAG” means regulated activity group as referred to in SUP;

“the Returns” means the CCR007 for the period ended 5 April 2023 which the
Firm was due to submit to the Authority by 23 May 2023;

“SFGB Levy” means the Single Financial Guidance Body Levy;

“SUP” means the Supervision Manual, part of the Handbook; and


“the Tribunal” means the Upper Tribunal (Tax and Chancery Chamber).






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FACTS AND MATTERS

5.
The Firm was authorised by the Authority on 25 June 2015 and has a Part 4A
permission to conduct the following regulated activities in relation to consumer
credit business:

i.
agreeing to carry on a regulated activity;
ii.
debt adjusting;
iii.
debt-counselling; and
iv.
credit broking;


6.
The Firm failed to pay periodic fees and levies owed to the Authority as required
under the Handbook under the rules set out in FEES 4.2.1R, 4.3.1R, 5.7.1R,
6.7.1R, 6.7.3R, 7A.3.1R and 13.2.1R. In particular, the Firm failed to pay:

a) an invoice dated 10 July 2019 for periodic fees and levies of £156.19, which had
been due for payment by 9 August 2019;
b) an invoice dated 05 August 2020 for periodic fees and levies of £160.33, which
had been due for payment by 03 November 2020;
c) an invoice dated 17 September 2021 for periodic fees and levies of £305.30,
which had been due for payment by 16 December 2021; and
d) an invoice dated 31 August 2022 for periodic fees and levies of £408.24, which
had been due for payment by 30 September 2022.

7.
The Firm is required to submit the Returns to the Authority by the relevant due
date in accordance with the following rules contained in SUP 16.3.11R, SUP
16.3.13R, SUP 16.12.3R, SUP 16.12.4R and SUP 16.12.29CR. However, the
Firm has failed to submit the Returns to the Authority. The Authority therefore
considers that the Firm has failed to provide information to the Authority as is
required by the Handbook, namely the information it is required to provide in
the Returns.

8.
On 22 January 2024, the Authority gave the Firm the Notice which stated that:

(a) it appears to the Authority that the Firm is carrying on no regulated activity
to which its Part 4A permission relates; and

(b) the Authority may take action to cancel the Firm’s Part 4A permission
unless it responds to the Notice in the manner specified in the directions
to the Notice.

9.
The Firm failed to respond to the Notice.


10. As a result of the matters specified above, on 20 February 2024, the Authority
gave the Firm the Further Notice which stated that:

a) the Authority considered that the Firm is carrying on no regulated activity
to which its Part 4A permission relates; and

b) the Authority proposes to cancel the Firm’s Part 4A permission on 18
March 2024 unless the Firm takes the steps specified in the directions to
the Further Notice.

11. The Firm failed to take the steps specified in the Further Notice.

CANCELLATION OF PART 4A PERMISSION


12. From the facts and matters described above, and having regard to paragraph
1(3) of Schedule 6A to the Act, the Authority considers that the Firm is carrying
on no regulated activity to which its Part 4A permission relates. The Authority
has therefore decided to cancel the Firm’s Part 4A permission. The cancellation
of the Firm’s Part 4A permission takes effect on the date of this Notice of
Decision.

13. The statutory and regulatory provisions relevant to this Notice of Decision are
set out in the Annexes.

PROCEDURAL MATTERS



14. This Notice of Decision is given to the Firm under paragraph 3 of Schedule 6A
to the Act (variation or cancellation of Part 4A permission on initiative of FCA:
additional power).


The following paragraphs are important.

Annulment of the Authority’s decision

15. If the Firm is aggrieved by the decision to cancel its Part 4A permission as set
out in this Notice of Decision, the Firm may make an application for an
annulment of the Authority’s decision under paragraph 4 of Schedule 6A to the
Act.

16. The Firm must submit a completed application for an annulment of the
Authority’s decision to the Authority by 17 March 2025 and in the manner
specified by the Authority.


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The Tribunal

17. The Firm does not have a right to refer the decision to give this Notice of
Decision to the Tribunal.

Publicity

18. The Authority intends to publish such information about the matter to which
this Notice of Decision relates as the Authority considers appropriate. The
information may be published in such manner as the Authority considers
appropriate.

Authority Contact

19. For more information concerning this matter generally, the Firm should contact
Ya Ngoneh Sarr (direct line: 020 7066 7944).



Robert Westwood

Manager - Event Supervision

Supervision - Retail & Authorisations Division



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ANNEX ON CANCELLATION OF PART 4A PERMISSION ON INITIATIVE OF

FCA: ADDITIONAL POWER

RELEVANT STATUTORY PROVISIONS

1.
The Authority’s operational objectives established in section 1B of the Act
include protecting and enhancing the integrity of the UK financial system and
securing an appropriate degree of protection for consumers.

2.
The Authority is authorised by paragraphs 1(1) and (2) of Schedule 6A to the
Act to cancel an Authority-authorised person’s Part 4A permission, if it appears
to the Authority that the Authority-authorised person is carrying on no
regulated activity to which the permission relates.

3.
Paragraph 1(3) of Schedule 6A of the Act provides that the circumstances in
which the Authority may form the view that an Authority-authorised person is
carrying on no regulated activity include (but are not limited to) circumstances
where the person fails —

(a) to pay any periodic fee or levy as is required by the Handbook, or

(b) to provide such information to the Authority as is required by the
Handbook.

4.
The Authority must exercise its power to cancel an Authority-authorised
person’s Part 4A permission using its additional own initiative power in
accordance with the procedure set out in paragraph 2 of Schedule 6A to the
Act.

RELEVANT HANDBOOK PROVISIONS

5.
In exercising its power to cancel an Authority-authorised person’s Part 4A
permission, the Authority must have regard to the regulatory requirements and
guidance published in the Handbook and in regulatory guides, such as EG. The
main considerations relevant to the action stated in this Notice of Decision are
set out below.

Relevant Rules

6.
FEES 4.2.1R requires that:

“A person shown in column (1) of the table in FEES 4.2.11 R as the
relevant fee payer must pay each periodic fee applicable to it, calculated

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in accordance with the provisions referred to in column (2) of the
applicable table, as adjusted by any relevant provision in this chapter:

(1)
in full and without deduction (unless permitted or required by a
provision in FEES); and

(2)
on or before the date given in column (3) of that table, unless
FEES 4.2.10 R applies.”

7.
FEES 4.3.1R states that:

“The periodic fee payable by a firm (except an AIFM qualifier, ICVC or a
UCITS qualifier) is:

(1)
each periodic fee applicable to it calculated in accordance with
FEES 4.3.3 R, using information obtained in accordance with FEES
4.4; plus

(1A) any periodic fee applicable to it calculated in accordance with FEES
4.3.3A R using information relating to its UK business obtained in
accordance with FEES 4.4 (or by other means in the case of the
Bank of England); less

(2)
any deductions from the periodic fee specified in Part 2 of FEES 4
Annex 2AR or Part 7 of FEES 4 Annex 11R.”

8.
FEES 5.7.1R requires that:


“A firm must pay annually to the [Authority] the general levy on or
before the later of 1 April and 30 calendar days after the date when the
invoice is issued by the [Authority].”

9.
FEES 6.7.1R requires that:

“A participant firm that is not within FEES 6.7.-1R, must pay its share
of any levy made by the FSCS in one payment”.

10. FEES 6.7.3R states that:

“A participant firm's share of a levy to which FEES 6.7.1R applies is due
on, and payable within 30 days of, the date when the invoice is issued.”

11. FEES 7A.3.1R requires that:


“A firm must pay the SFGB money advice levy or SFGB debt advice levy
applicable to it:

(1)
in full and without deduction (unless permitted or required by a
provision in FEES); and

(2)
by 1 August or, if later, within 30 days of the date of the invoice
in the fee year to which that sum relates.

12. FEES 13.2.1R requires that:

“A firm must pay each IML levy applicable to it:

(1)
in full and without deduction by 1 August (or, if later, within 30
days of the date of the invoice) in the financial year to which the
sum relates; and

(2)
in accordance with the rules in this chapter.

13. SUP 16.3.11R requires that:

“A firm must submit reports required under this chapter to the [Authority]
containing all the information required.”

14. SUP 16.3.13R(1) requires that:

“A firm must submit a report required by this chapter in the frequency, and so
as to be received by the [Authority] no later than the due date, specified for
that report.”

15. SUP 16.3.13R(4) states that:

“If the due date for submission of a report required by this chapter is a set
period of time after the end of a half-year, a quarter, or a month, the dates will
be determined by (a) or (b) below except where otherwise indicated:

(a) the firm's accounting reference date;

(b) monthly, 3 monthly or 6 months after the firm's accounting reference date,
as the case may be.”

16. The Firm falls within RAG 12. A firm’s RAG dictates specific reporting
requirements for that firm, based on regulated activities which the firm has
permission to carry on and arise from the rules contained in SUP, which

stipulates the data item or regulatory report, frequency and the date by which
the relevant data item or regulatory report is required to be submitted. The
reporting requirements relevant to the Firm are set out in the rules specified in
paragraph 7 of this Notice of Decision.


Guidance concerning the use of the Authority’s additional power to
cancel an authorised firm’s Part 4A permission on its own initiative

17. Guidance on the use of the Authority’s power to cancel an Authority-authorised
person’s Part 4A permissions on its own initiative under Schedule 6A to the Act
is set out in SUP and EG.

18. EG 8.5.2A states that the Authority may cancel the Part 4A permission of a firm
that is an Authority-authorised person, under Schedule 6A of the Act, if:

(1) it appears to the Authority that the firm is carrying on no regulated
activity to which the permission relates; and

(2) the firm has failed to respond as directed by the Authority to notices
served by the Authority to the firm under paragraph 2 of Schedule 6A.

19. EG 8.5.2A also states that Schedule 6A specifies that the Authority may form
the view that a firm is carrying on no such regulated activity on the basis of its
failure to pay a periodic fee or levy or provide information to the Authority, in
each case as required by the Handbook.

20. SUP sets out further guidance on the Authority’s power under Schedule 6A of
the Act. In particular, SUP 7.2.2AG states that the Authority may decide to
cancel an Authority-authorised person’s Part 4A permission using its powers
under Schedule 6A of the Act:

(1) if that person appears to the Authority not to be carrying on any
regulated activity to which the permission relates, including, without
restriction, if the person has failed to:

(a) pay a periodic fee or levy under the Handbook; or

(b) provide the Authority with information required under the
Handbook; and

(2) if that person, when served by the Authority with two notices under
paragraph 2 of Schedule 6A of the Act, has not:


(a) responded in the manner directed, in those notices or otherwise,
by the Authority; nor

(b) taken other steps as may also be directed by the Authority;

the second of which notices will specify the effective date of the
proposed cancellation.


21. SUP 7.2.2DG states that:

(1) the Authority’s additional own-initiative variation power under
Schedule 6A to the Act (which includes the power to cancel the Part 4A
permission of an Authority-authorised firm under Schedule 6A of the
Act and references to “additional own-initiative variation power in the
remainder of this Notice of Decision should be read as such) has, unlike
the Authority’s own-initiative variation power under section 55J of the
Act, a single basis: that it appears to the Authority that the relevant
Authority-authorised person is not carrying on any regulated activity
to which its Part 4A permission relates.

(2) if the Authority uses its additional own-initiative variation power, it is
therefore more likely to cancel the relevant firm’s Part 4A permission,
rather than merely varying it by removing or amending the description
of one or more such activities or by imposing one or more limitations.

(3) the Authority will, however, consider all relevant facts and
circumstances, including, without restriction:

(a) the relevant firm’s responses, if any, to the notices given by the
Authority under paragraph 2 of Schedule 6A; and

(b) if applicable, the factors described in SUP 6.4.22G, including
whether there are any matters relating to the firm requiring
investigation,

before deciding whether to use its additional own-initiative variation power and
whether to use it to cancel or vary.

22. SUP 7.2.7G(1) states that a firm has no right of referral to the Tribunal in
respect of the Authority exercising its additional own-initiative variation power,
under Schedule 6A to the Act, on the Authority-authorised firm’s Part 4A
permission.