Topic: FCA refuses authorisation to regulatory consultancy firm Alexander Jon Compliance Consulting Limited.
Overview: The Financial Conduct Authority (FCA) has refused to authorise Alexander Jon Compliance Consulting Limited (AJCC) to provide regulatory hosting services. This is a service which would have allowed AJCC to take responsibility for firms carrying out regulated activities without being directly approved by the FCA. These firms would then be an appointed representative (AR) of AJCC.
AJCC could not demonstrate that it had the skills, experience or the staff to oversee ARs. It was unable to describe a viable or sustainable business model. AJCC was also unable to explain how its ARs would assess that products or services were appropriate for consumers, or to demonstrate that it would have direct responsibility for the conduct and compliance of its ARs. The FCA refused the application with the intention of protecting consumers from the risk of using a poorly overseen investment business.
The FCA also reminded those providing regulatory hosting services that they are accountable for the actions of their ARs and need to have the ability and skill to properly supervise them. The FCA has previously highlighted common issues with oversight of ARs and committed to improving the standards in this sector as part of its 2022-2025 Strategy.
The FCA also provided the Final Notice for AJCC:
Emily Shepperd, Executive Director of Authorisations at the FCA, said:
‘It is vital those who are seeking the FCA’s authorisation meet our high standards. If this is not the case, we will refuse their applications in the interests of consumers and other businesses.’
Penalty: Rejection of Authorisation.