The FCA has imposed a fine of £450,000 on Mr Timothy Alan Roberts, of Catalyst Investment Group Limited, for failure to comply with Statement of Principles 1 and 6 of the FCA’s Statements of Principle for Approved Persons and has made an order prohibiting Mr Roberts from performing any function in relation to any regulated activities carried on by any authorised or exempt persons, or exempt professional firm.

The FCA’s action follows a decision by the Upper Tribunal (Tax and Chancery Chamber) that Mr Roberts’ behavior showed a lack of integrity and that he failed to act with due care, skill and diligence in continuing to permit Catalyst:

• to promote ARM bonds (structured products issued by a Luxembourg entity, ARM, the underlying assets of which are senior life settlement policies) and
• collect funds from potential investors despite awareness that ARM had been asked to stop issuing bonds by the relevant regulator

On 27 January 2016, the Court of Appeal refused Mr Roberts permission to appeal and, therefore, the FCA has issued the final notice in this matter. A copy of the FCA’s final notice is available HERE

On 11 September 2013 Mr Roberts referred this Decision Notice to the Upper Tribunal (Tax and Chancery Chamber) (“the Tribunal”).

The Tribunal determined that Mr Roberts had breached Statements of Principle 1 and 6, and directed the Authority to impose a financial penalty on Mr Roberts of £450,000 pursuant to section 66 of the Financial Services and Markets Act 2000 (“the Act”).

The Tribunal also dismissed Mr Roberts’ reference in relation to the prohibition order the Authority had decided to make pursuant to section 56 of the Act and the withdrawal of his approval to carry out controlled functions at Catalyst pursuant to section 63 of the Act. 2.4.

The Tribunal’s written decision sets out fully the Tribunal’s reasons for determining the appropriate action for the Authority to take in relation to Mr Roberts as described above.

It should therefore be read in full. Those reasons are incorporated herein by reference to the Tribunal’s conclusions, as to the facts and the appropriate outcomes, included the following at paragraph 280 of its written decision:

• “We consider the degree to which Mr Roberts acted with a lack of integrity to be serious.
• He closed his mind to the reality that both ARM and the CSSF considered that ARM required authorisation, closed his mind to the difficulties in ARM’s application and as a result gave misleading reports to personnel at Catalyst as to the tenor of meetings he attended with the CSSF.
• He also failed to consider the interests of investors in pending tranche 9 when he authorised the receiving agents to pay over part of the funds held by them to Catalyst and ARM.
• Even when the Authority brought its concerns to his attention in April 2010 and asked it to cease allowing the promotion of the bonds, with the consequent receipt of income, he resisted that request.”

The written decision of the Tribunal was released on 11 August 2015 and can be found on the Tribunal’s website HERE