FINAL NOTICE

1 The Canal Wharf
Canal Street
Littleborough
Greater Manchester
OL15 0HA


ACTION

1. By an application dated 24 November 2020 (“the Application”), NWUS Ltd

(“NWUS”) applied under section 55A of the Act for Part 4A permission to carry on
the regulated activities of:

a. agreeing to carry on a regulated activity;

b. consumer hire;

c. limited permission debt adjusting;

d. limited permission debt counselling; and

e. providing credit information services.

2. For the reasons set out below, the Authority has refused the Application.

SUMMARY OF REASONS

3. By its Warning Notice dated 1 October 2021, the Authority gave notice that it

proposed to refuse the Application and that NWUS was entitled to make
representations to the Authority about that proposed action.

4. As no representations were received by the Authority from NWUS within the time

allowed by the Warning Notice, the default procedures in paragraph 2.3.2 of the
Authority’s Decision Procedure and Penalties Manual apply, permitting the Authority
to treat the matters referred to in its Warning Notice as undisputed and,
accordingly, to give a Decision Notice.

5. By its Decision Notice dated 29 November 2021, the Authority gave NWUS notice

that it had decided to take the action described above. NWUS had 28 days from
the date the Decision Notice was given to refer the matter to the Tribunal. No
referral was made to the Tribunal within this period of time or to date.

6. Under section 390(1) of the Act, the Authority, having decided to refuse the

Application and there having been no reference of that decision to the Tribunal,
must give NWUS a Final Notice of its refusal.

7. For the reasons set out herein, the Authority cannot ensure that NWUS will satisfy,

and continue to satisfy, the threshold conditions set out in schedule 6 of the Act.
Specifically, NWUS has not satisfied the Authority that it will conduct its business
with integrity and in compliance with proper standards as required by threshold
condition 2E (suitability).

8. This is principally based on NWUS’s connection with Mr Steven Bennett, who was

previously a shareholder and director at NWUS and was named in the Application
as its proposed candidate to perform the SMF29 Limited Scope function.

9. The information held by the Authority pertaining to Mr Bennett (namely, regarding

his involvement in the management of two other firms, which appear to be
connected to NWUS) raise concerns as to whether those who manage NWUS’ affairs
have adequate skills and experience and will act with probity.

10. In light of the above, the Authority has refused the Application.

DEFINITIONS

11. The definitions below are used in this Final Notice.

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

“the Application” means the application referred to in paragraph 1 above;

“the Authority” means the Financial Conduct Authority;

“COND” means the part of the Handbook entitled “Threshold Conditions”;

“FIT” means the Fit and Proper test for Employees and Senior Personnel;

“Handbook” means the Authority’s Handbook of Rules and Guidance;

“SMF” means Senior Management Function;

“SMF29” means the SMF29 Limited Scope function;

“SUP” means the Supervision section of the Authority’s Handbook;

“SYSC” means the Senior Management Arrangements, Systems and Controls
section of the Authority’s Handbook;

“the Firm” means NWUS Ltd;

“the Tribunal” means the Upper Tribunal (Tax & Chancery Chamber);

“the Decision Notice” means the decision notice dated 29 November 2021 given to
NWUS by the Authority; and

“the Warning Notice” means the warning notice dated 1 October 2021 given to
NWUS by the Authority.

FACTS AND MATTERS

Background to the application

12. NWUS was incorporated in August 2019. Its registered offices are located in

Rochdale, England.

13. On 24 November 2020, NWUS applied for permission to carry on consumer hire,

and other, regulated activities. The Authority understands from the Application that
NWUS applied for authorisation in order to enter into regulated consumer hire
agreements with consumers, in respect of the vehicles it owns.

14. In its Application, NWUS named Mr Steven Bennett as its proposed candidate to

perform the SMF29 Limited Scope function at NWUS. Mr Bennett was previously a
director and shareholder at NWUS until 24 February 2021, when he resigned from
both positions.

Concerns regarding Mr Bennett

15. In the course of considering the Application, the Authority became aware of

information relating to Mr Bennett’s involvement at two other firms, which shall be
referred to as “Firm X” and “Firm Y” respectively, and their connection with NWUS.

16. Firm X is a regulated entity that is authorised to carry on consumer credit regulated

activities, including: limited permission credit broking, limited permission debt
adjusting and limited permission debt counselling. It was authorised by the
Authority in February 2020. From this time, Mr Bennett was approved to perform
the SMF29 Limited Scope function at Firm X.

17. The relevant information concerning Mr Bennett and Firm X was received by the

Authority in April 2020, shortly before Mr Bennett resigned from his position as a
director at Firm X. The source of the information is a third-party finance provider,
who notified the Authority that it wished to remove Firm X from its panel of credit
brokers.

18. The reasons cited for the third-party finance provider removing Firm X from its

panel were due to suspicions regarding potentially fraudulent activity that arose
from finance applications submitted to it by Firm X. Specifically, three finance
applications submitted by Firm X contained the bank details of either a company

associated with Firm X, or Mr Bennett personally, rather than the bank details of
the relevant applicants.

19. Separately, on 24 November 2020, Firm Y applied to the Authority for

authorisation. This was also the same day as NWUS submitted the Application to
the Authority. Mr Bennett is the sole director and shareholder of Firm Y. Firm Y
applied to carry on the same regulated activities as those applied for by NWUS in
the Application. Mr Bennett was similarly named as the proposed candidate to
perform the SMF29 Limited Scope function in Firm Y’s application.

20. In the course of assessing Firm Y’s application, the Authority identified that Firm Y

appeared to be in breach of section 24 of the Act, by making false claims to be
authorised by the Authority. On its website, Firm Y published a disclosure statement
which included a Firm Reference Number (the reference number allocated to
regulated entities) belonging to Firm X. Firm Y also adopted an identical trading
name to Firm X.

21. As such, the Authority considered the statement published by Firm Y to be wilfully

misleading to its consumers. Firm Y removed the statement from its website in
February 2021, following its communications with the Authority. However, Firm Y
did not offer any explanation in relation to the Authority’s concerns regarding the
removal of Firm X from the third-party finance provider’s panel.

22. On 22 April 2021, following an assessment of Firm Y’s Part 4A application, the

Authority decided to issue a warning notice to Firm Y proposing to refuse the
application in light of concerns as to the firm’s suitability and the same concerns
relating to Mr Bennett and Firm X that are outlined above.

23. On 5 May 2021, after receiving its warning notice, Firm Y withdrew its application

for Part 4A permission.

24. The Authority notes that in the Application, it was stated that NWUS intended to

adopt Firm Y’s registered company name as a trading name. The Application also
stated that NWUS also intended to adopt a trading name used by both Firm X and
Firm Y. The Authority considers these statements demonstrate the connected
nature of NWUS, Firm X and Firm Y, with the common factor being Mr Bennett and
his continued involvement in all three companies.

25. There was no reference made to any relationship between Firm X, Firm Y and NWUS

in the Application, notwithstanding the identical trading names shared between the
three companies.

IMPACT ON THE THRESHOLD CONDITIONS

26. The regulatory provisions relevant to this Final Notice are referred to in Annex A.

27. In light of the facts and matters set out above and for the reasons set out above

and below, the Authority considers that it cannot ensure that NWUS will satisfy, at
the point of authorisation, threshold condition 2E (suitability).

28. In order to satisfy threshold condition 2E (suitability), a firm must be fit and proper

having regard to all of the circumstances, including the need for those who manage
the firm’s affairs have adequate skills and experience and act with probity. COND
2.5.4G sets out examples of the kind of considerations to which the Authority may
have regard when assessing whether a firm will satisfy, and continue to satisfy,
threshold condition 2E. These include whether the firm: (i) conducts, or will

conduct, its business with integrity and in compliance with proper standards; (ii)
has, or will have, a competent and prudent management; and (iii) can demonstrate
that it conducts, or will conduct, its affairs with the exercise of due skill, care and
diligence.

29. In view of the above concerns regarding Mr Bennett, who as the firm’s proposed

candidate to perform the SMF 29 Limited Scope function would be involved in
NWUS’s affairs in respect of its regulated activities, the Authority considers it
cannot ensure that those who manage NWUS’s affairs have adequate skills and
experience, and will act with probity.

30. The Authority recognises that its concerns relate to Mr Bennett’s involvement at

NWUS and that he is no longer a director or shareholder of the firm. However, Mr
Bennett remains NWUS’s candidate to perform the SMF29 Limited Scope function,
and the Authority is concerned that in view of the connections between NWUS, Firm
X and Firm Y that are described above, Mr Bennett will continue to exercise control
and influence in the management of NWUS’s affairs. The Authority considers that
these connections are further exemplified by the timing of Mr Bennett’s resignation
from his position as director and shareholder of NWUS on 24 February 2021. This
was eight days after the Authority informed Firm Y of its intention to refuse Firm
Y’s application for Part 4A permission.

31. Given the concerns outlined above, it does not appear to the Authority that NWUS

will satisfy, and continue to satisfy, the threshold conditions in relation to all of the
regulated activities for which NWUS would have permission if the Application was
granted.

PROCEDURAL MATTERS

32. This Final Notice is given under section 390(1) of the Act.

33. Sections 391(4), 391(6) and 391(7) of the Act apply to the publication of

information about the matter to which this Notice relates. Under those provisions,
the Authority must publish such information about the matter to which this Notice
relates as the Authority considers appropriate. 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 you or prejudicial to the interests of consumers or detrimental to the
stability of the UK financial system.

34. The Authority intends to publish such information about the matter to which this

Final Notice relates as it considers appropriate.

Authority contacts

35. For more information concerning this matter generally, contact Emily Pinkerton,

Manager, Credit & Lending Department at the Authority (direct line: 020 7066 1450
/ email: Emily.Pinkerton@fca.org.uk).

Executive Decision Maker

ANNEX A – REGULATORY PROVISIONS RELEVANT TO THIS WARNING NOTICE

1. Section 55A(1) of the Act provides for an application for permission to carry on one

or more regulated activities to be made to the appropriate regulator. Section
55A(2) defines the “appropriate regulator” for different applications.

2. Section 55B(3) of the Act provides that, in giving or varying permission, imposing

or varying a requirement, or giving consent, under any provision of Part 4A of the
Act, each regulator must ensure that the person concerned will satisfy, and
continue to satisfy, in relation to all of the regulated activities for which the person
has or will have permission, the threshold conditions for which that regulator is
responsible.

3. The threshold conditions are set out in schedule 6 to the Act. In brief, the threshold

conditions relate to:

(1)
Threshold condition 2B: Location of offices

(2)
Threshold condition 2C: Effective supervision

(3)
Threshold condition 2D: Appropriate resources

(4)
Threshold condition 2E: Suitability

(5)
Threshold condition 2F: Business model

Relevant provisions of the Authority’s Handbook

Guidance on the Threshold Conditions (“COND”)

4. In exercising its powers in relation to the granting of a Part 4A permission, the

Authority has regard to guidance published in the Authority’s Handbook, including
the part entitled ‘Threshold Conditions’ (“COND”). This sets out the minimum
standard for being and remaining authorised.

5. COND 1.3.2G(2) states that, in relation to threshold conditions 2D to 2F, the

Authority will consider whether a firm is ready, willing and organised to comply on
a continuing basis with the requirements and standards under the regulatory
system which will apply to the firm if it is granted Part 4A permission.

6. Under COND 1.3.3AG, in determining the weight to be given to any relevant matter,

the Authority will consider its significance in relation to the regulated activities for
which the firm has, or will have, permission, in the context of its ability to supervise
the firm adequately, having regard to the Authority’s statutory objectives. In this
context, a series of matters may be significant when taken together, even though
each of them in isolation might not give serious cause for concern.

7. COND 1.3.3BG provides that, in determining whether the firm will satisfy, and

continue to satisfy, the Authority threshold conditions, the Authority will have
regard to all relevant matters, whether arising in the United Kingdom or elsewhere.

8. COND 1.3.3CG provides that, when assessing the threshold conditions, the

Authority may have regard to any person appearing to be, or likely to be, in a
relevant relationship with the firm, in accordance with section 55R of the Act

(Persons connected with an applicant). For example, a firm's controllers, its
directors or partners, other persons with close links to the firm (see COND 2.3),
and other persons that exert influence on the firm which might pose a risk to the
firm's satisfaction of the threshold conditions, would be in a relevant relationship
with the firm.

Threshold condition 2E: Suitability

9. COND 2.5.2G(2) states that the Authority will also take into consideration anything

that could influence a firm's continuing ability to satisfy threshold conditions set
out in paragraphs 2E and 3D of schedule 6 to the Act. Examples include the firm's
position within a UK or international group, information provided by overseas
regulators about the firm, and the firm's plans to seek to vary its Part 4A permission
to carry on additional regulated activities once it has been granted that permission.

10. COND 2.5.3G(1) states that the emphasis of threshold condition 2E is on the

suitability of the firm itself. The suitability of each person who performs a controlled
function will be assessed by the Authority and/or the PRA, as appropriate, under
the approved persons regime (see SUP 10 (Approved persons) and FIT). In certain
circumstances, however, the Authority may consider that the firm is not suitable
because of doubts over the individual or collective suitability of persons connected
with the firm.

11. COND 2.5.4G(2) states that examples of the kind of general considerations to which

the Authority may have regard when assessing whether a firm will satisfy, and
continue to satisfy, threshold condition 2E include, but are not limited to, whether
the firm:

(a)
conducts, or will conduct, its business with integrity and in compliance with
proper standards;

(b)
has, or will have, a competent and prudent management; and

(c)
can demonstrate that it conducts, or will conduct, its affairs with the exercise
of due skill, care and diligence.

12. COND 2.5.6G provides that examples of the kind of particular considerations to

which the Authority may have regard when assessing whether a firm will satisfy,
and continue to satisfy, this threshold condition include, but are not limited to,
whether the firm has been open and co-operative in all its dealings with the
Authority and any other regulatory body (see Principle 11 (Relations with
regulators)) and is ready, willing and organised to comply with the requirements
and standards under the regulatory system (such as the detailed requirements of
SYSC and, in relation to a firm not carrying on, or seeking to carry on, a PRA-
regulated activity only, the Prudential Standards part of the Authority’s Handbook)
in addition to other legal, regulatory and professional obligations; the relevant
requirements and standards will depend on the circumstances of each case,
including the regulated activities which the firm has permission, or is seeking
permission, to carry on.