Law and Justice concept

FCA drives home the fact that fitness and propriety involves non-financial conduct

On 5 November 2020, the FCA published final notices banning three individuals (all financial advisers) from working in the financial services industry following findings that they were not fit and proper on account of their non-financial conduct.

Russell Jameson was sentenced to 5 years’ imprisonment in July 2018 for making, possessing and distributing indecent images of children.

Mark Horsey was sentenced to 9 months’ imprisonment (suspended) for voyeurism.  He recorded his tenant having a shower without her consent.

Frank Cochran was sentenced to 7 years’ imprisonment for sexual assault

All three were found to lack the necessary integrity and reputation to work in the regulated financial service sector.

The Conduct Rules require all staff to act with integrity.  They also require tailored training to be given on conduct that is/is not acceptable.  The fact that non-financial misconduct is a relevant factor in assessing fitness and propriety should come as a surprise to nobody.  In a speech in December 2018, the FCA’s Christopher Woolard stated clearly that “non-financial misconduct is misconduct, plain and simple”.

The findings of the FCA’s Regulatory Decisions Committee serve as a good insight into the FCA’s views on this topic – particularly where conduct may fall into a grey area.  A number of firms use these examples to help refine, develop and refresh their own internal training programmes.  However, whilst good to be aware of, the present cases are black-and-white and so have limited value in this respect.