Criteria Wealth Management Limited, Mark Peter Penney, Marc Adam Roxby (2020-05-04)

Summary

This is a public enforcement statement issued by the Guernsey Financial Services Commission on 4 May 2020 concerning Criteria Wealth Management Limited (CWM), its former Managing Director Mark Peter Penney, and former director Marc Adam Roxby. The Commission found that CWM conducted unlicensed investment business by advising on and selling Category 2 Controlled Investments (Structured Notes) despite only holding a licence for Category 1 Controlled Investments, and that CWM, Penney and Roxby failed to meet minimum licensing criteria (fitness and propriety, competence, professional skill) under the POI Law, IMII Law, Insurance Law, Banking Law and Fiduciaries Law.

• CWM: No financial penalty imposed because CWM was compulsorily wound up on 31 January 2019 with no funds for unsecured creditors; the Commission notes a discretionary £50,000 penalty would otherwise have been appropriate.
• Mr Penney: Fined £40,000 under section 11D of the Financial Services Commission Law; prohibited for 6 years from acting as director, controller, partner, manager, financial adviser, general representative or authorised insurance representative; the section 3(1)(g) Fiduciaries Law exemption is disapplied to him for 6 years.
• Mr Roxby: Fined £20,000 under section 11D of the Financial Services Commission Law; prohibited for 4 years from acting as director, controller, partner or manager; the section 3(1)(g) Fiduciaries Law exemption is disapplied to him for 4 years.
• Public statement: The Commission has made a public statement under section 11C of the Financial Services Commission Law setting out the findings, breaches and sanctions.

The findings detail breaches of the POI Law, IMII Law, the Licensees (Conduct of Business) Rules, and Principle 2 of the Principles, including unlicensed sale of Structured Notes, unsuitable advice to an elderly client, non disclosure of remuneration, undisclosed conflicts of interest in share sales, and inadequate advisor qualifications. Mitigating factors included CWM's remediation efforts and cooperation with the investigation.

Key obligations

• Mr Penney must not act as director, controller, partner, manager, financial adviser, general representative or authorised insurance representative for a period of 6 years from the decision date.
• Mr Roxby must not act as director, controller, partner or manager for a period of 4 years from the decision date.
• The section 3(1)(g) Fiduciaries Law exemption is disapplied in respect of Mr Penney for 6 years and Mr Roxby for 4 years, meaning they cannot rely on that exemption during those periods.
• Mr Penney must pay a financial penalty of £40,000 under section 11D of the Financial Services Commission Law.
• Mr Roxby must pay a financial penalty of £20,000 under section 11D of the Financial Services Commission Law.

Applies to

investment businesses licensed under the POI Law, insurance intermediaries licensed under the IMII Law, fiduciary licensees under the Fiduciaries Law, individuals holding director, controller, partner, manager or advisory positions in Guernsey regulated entities

Deadlines

• 6 years: Prohibition on Mr Penney holding director, controller, partner, manager, financial adviser, general representative or authorised insurance representative positions, and disapplication of the Fiduciaries Law section 3(1)(g) exemption.
• 4 years: Prohibition on Mr Roxby holding director, controller, partner or manager positions, and disapplication of the Fiduciaries Law section 3(1)(g) exemption.