<p>The British
<a href=”https://www.financemagnates.com/terms/f/financial-conduct-authority-fca/” class=”terms__main-term” id=”4c85a54d-15e0-4e44-a214-8c55f71cb286″ target=”_blank”>Financial Conduct Authority (FCA</a>) has commenced court proceedings against Argento
Wealth Ltd (AWL) and Daniel Willis, its sole director, for unauthorized trading
activities. The regulator wants to recover money that was lost by the victims due to the company’s unlawful activities.</p><p>FCA Wants to Recover the Investors’ Money</p><p>According
to a press release published by the FCA on Tuesday, the UK financial markets
regulator accuses AWL of three regulatory breaches. Firstly, the firm was
alleged to have unlawfully accepted £2.8m as a deposit under an unlicensed
investment scheme and loan agreements. Secondly,
it unlawfully arranged investments totalling $9m in EMB Fund Limited (EMB), and
thirdly, it breached financial promotion legislation and the restrictions
placed on financial service providers in this regard.</p><p>According
to the FCA, Willis was fully aware that his activities were unlawful. AWL,
which he represented, was unable to produce any evidence to suggest that the
company would repay the loans made to EMBs and retail investors. As a result, the
company became officially insolvent.</p><p>”The
FCA has obtained undertakings equivalent to interim orders freezing AWL’s/Mr
Willis’ remaining assets. This action has been taken with the aim of protecting
investors pending seeking final orders compensating approximately 13 lenders
who lent money to AWL and many others harmed by AWL’s unlawful investment
promotion,” the FCA stated in the statement.</p><p>It does not
change the fact that, according to the FCA, investors who give their money to
AWL will suffer significant losses. This is because the assets that remain in
the hands of the fraudulent firm are far less than the sums needed to cover
liabilities to all clients.</p><p>”No
date has yet been set for the High Court trial concerning the restitution
order,” the FCA added.</p><p>Watch the recent FMLS22 regulation roundup.</p><p>FCA Rejects 1400% More
Rogue Financial Ads</p><p>Controlling
inappropriate advertising of financial services has become one of the FCA’s significant
objectives over the past year. Allegations made to AWL in this regard involved
8,582 other financial promotions, leading to their amendment or removal. <a href=”https://www.financemagnates.com/fintech/uk-regulator-clamps-down-on-1400-more-rogue-financial-ads-in-2022/” target=”_blank” rel=”follow”>This
is 1,400% more</a> than the 573 financial promotion breaches in 2021.</p><p>The
regulator also managed to significantly increase the number of fraudulent
investment warnings to 1,800, which the FCA says was made possible by a
significant improvement in available digital tools used to identify problematic
firms and their fraudulent advertising and offers.</p><p>2022 Brought Record Number
of Financial Fines </p><p><a href=”https://www.financemagnates.com/institutional-forex/regulators-slapped-industry-with-record-fines-in-2022-sec-in-the-lead/” target=”_blank” rel=”follow”>According
to SteelEye’s Fine Tracker</a>, the industry has seen record financial penalties exceeding $7 billion in 2022. The US Securities and Exchange Commission alone has slapped the unlawful firm with $6.4bn of fines, <a href=”https://www.financemagnates.com/institutional-forex/us-sec-penalizes-16-top-firms-over-11b-for-recordkeeping-failures/” target=”_blank” rel=”follow”>including a $1.1bn penalty from its Crackdown on
WhatsApp</a>.</p><p>The FCA increased the number of penalties to 26 in 2022, which is a huge increase from 10 in 2021, with the highest fine at the end of 2022 paid by Santander UK. The bank’s fine amounted to <a href=”https://www.financemagnates.com/institutional-forex/fca-fines-santander-uk-108-million-for-prolonged-aml-breaches/” target=”_blank” rel=”follow”>£108 million for prolonged AML breaches</a>.</p><p>”There
remains a lot of work to be done by financial services firms to ensure they do
not fall short of their <a href=”https://www.financemagnates.com/terms/o/obligations/” class=”terms__secondary-term” id=”5dbcbf88-8622-4828-a29c-70a680d32fb5″ target=”_blank”>obligations</a>. As regulators get more aggressive in their
enforcement action, firms need to really think about how robust their
compliance programs and policies are. Particularly against the backdrop of
recession fears, pressure to perform is mounting. With that, firms of all sizes
are putting de-risking strategies in place,” Matt Smith, the CEO and
Co-Founder of SteelEye, said.</p>
This article was written by Damian Chmiel at www.financemagnates.com.
