In FCA v Markou, the Court of Appeal has allowed an appeal by the FCA against a decision of the Upper Tribunal in a reference made by a senior mortgage adviser subject to the Senior Managers’ regime. The Court of Appeal held that, on the factual conclusions made by the Upper Tribunal at the trial of the reference, the applicant lacked integrity contrary to Statement of Principle 1. The Court of Appeal accordingly remade the decision, imposing a financial penalty and prohibiting the applicant from working in financial services.
The original reference was made by the applicant, a CEO of a residential mortgage broking business, against the decision of the FCA imposing a prohibition and financial penalty. The FCA’s case was that the applicant had failed to act with integrity in the conduct of the firm’s business, resulting in exposure of customers to mortgage fraud. The misconduct arose from the respondent’s approach to professional indemnity insurance coverage and the evidence that he gave in cross-examination in the proceedings in question.
The judgment considers the approach to integrity cases in financial services in the context of recklessness. The Court of Appeal also considered the irrationality standard when appealing from decisions of the Upper Tribunal.
The judgment is available here.
Edward Brown KC, instructed by Matthew Hendin and Robert Fellowes of the FCA Legal Department, acted for the FCA.
