UK Offence Report

Misleading the FCA

regulation 24(3) of The Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016

This offence was read from the text as made, and no revised version was available, so a later revocation could not be ruled out. Check the current text at legislation.gov.uk.

What the provision says

3 A person who contravenes paragraph (1) or (2) is guilty of an offence.

Text as made, from legislation.gov.uk. © Crown copyright, reused under the Open Government Licence v3.0. This is the text as originally made; later amendments are not shown here.

Who it binds, and what has to be proved

Binds
a person
Conduct
contravening a requirement of the instrument
Fault element
Strict liability
Burden of proof
No statutory defence — prosecution proves everything

The prosecution must prove that the conduct happened. This is a strict liability offence as drafted: the provision uses no word of intention, knowledge, recklessness or negligence, so there is no need to show that a person meant to do it, knew about it, or was careless.

Intention, knowledge and carelessness are irrelevant to guilt. They may still matter a great deal to sentence.

The provision states no defence, so the prosecution bears the burden on every element of the offence.

Classifier’s reasoning: no word of intention, knowledge, recklessness or negligence in the offence or its provision.

What would breach regulation 24(3)?

These are illustrations, not law. They are generated from the provision’s own words to show the shape of the offence. Whether any particular conduct is caught depends on the full text, on any amendment since, and on the facts.

  1. On these words an offence is committed where a person contravenes paragraph (1) or (2).
  2. Doing the thing the provision prohibits under the Financial Services and Markets Act 2000 (Transparency of Securities Financing Transactions and of Reuse) Regulations 2016, whatever the reason for doing it.
  3. Where the requirement is a positive duty, letting the time for performing it pass without performing it.

Penalty

Mode of trial
Either way — magistrates’ court or Crown Court
Maximum fine
Unlimited
Maximum prison (summary)
Not determined

expressed as the statutory maximum (the prescribed sum): the same words mean £5,000 in England and Wales and £10,000 in Scotland.

Sentencing

Offences of this kind are usually sentenced under the guidelines below. This is a mapping by subject, not a finding about this provision, and the links go to a search of the Sentencing Council’s own site.

Prosecution figures

No published per-offence figure was found for this provision, and it could not be matched to a Ministry of Justice offence code. Offences created by statutory instrument very largely do not have one. Absence of a figure is not evidence that the offence is unused.

Status and lifecycle

Current status
Status not determined
Made
7 July 2016
In force from
13 July 2016
Extent
Not stated

How this was established: read from the text as made; no revised version available, so later revocation could not be ruled out.

What the instrument is for

(This note is not part of the Regulations) — the explanatory note published with the instrument, © Crown copyright.

These Regulations implement certain Articles of Regulation (EU) 2015/2365 of the European Parliament and of the Council of 25 November 2015 on transparency of securities financing transactions and of reuse and amending Regulation (EU) No 648/2012 (OJ No L 337, 23.12.2015, p.1) (“the SFT regulation”). In Part 2, regulation 3 designates the Bank of England (“the Bank”) as the competent authority responsible for supervising recognised central counterparties for the purposes of the SFT regulation. For all other counterparties the Financial Conduct Authority (“FCA”) is designated as the competent authority. Part 3 provides administration and enforcement powers to the FCA so that it can monitor and enforce the compliance of non-authorised counterparties with the SFT regulation. Non-authorised counterparties are those counterparties that are not already subject to supervision by the FCA or the Bank of England under the Financial Services and Markets Act 2000 (c.8) (“the Act”). In particular, Part 3 confers powers on the FCA for information gathering, giving directions for action to be taken to comply with the SFT regulation, publicly censuring counterparties for breach of the SFT regulation and imposing financial penalties. Part 3 also provides a power to the FCA to temporarily prohibit an individual responsible for a counterparty’s breach of the SFT regulation from being concerned in the management of a financial or non-financial counterparty. The same power is conferred on the Bank in relation to an individual responsible for a breach by a recognised central counterparty. Notice and appeal rights are also provided for and the competent authority is given the power to seek an injunction against any person who has breached or is likely to breach a requirement imposed by or under Part 3. Part 3 also makes it an offence to mislead the FCA in purported compliance with a requirement imposed under Part 3. Part 4 provides for these Regulations to be reviewed before the end of 2020 and subsequently at intervals of not more than five years. Schedule 1 amends the Act and paragraph 4 of Schedule 2 amends the Financial Services and Markets Act 2000 (Qualifying EU Provisions) Order 2013 (S.I. 2013/165) to implement fully the minimum sanctions and other measures required by the SFT regulation in respect of authorised persons and regulated bodies under the Act. The remainder of Schedule 2 makes consequential amendments to secondary legislation. An impact assessment of the effect that this instrument will have on the costs of business and the voluntary sector has not been prepared. These Regulations provide an enforcement mechanism for obligations which are imposed by directly applicable EU legislation and any impact on business or the voluntary sector will arise as a result of that EU legislation rather than these Regulations.

Read the full note and every offence in this instrument

How this was identified as an offence

Everything above rests on the judgement that this provision creates a criminal offence, rather than mentioning one. That judgement is made by rule, from the words of the provision, and this is the rule that made it — with a confidence of 0.92.

Basis
the provision says a person is “guilty of an offence”
Confidence
0.92 of 1.00

A provision that states a penalty for an offence created elsewhere can read very like one that creates an offence, and the rules can mistake the one for the other. If the text quoted above sets a penalty for something made an offence by another provision, treat the classification on this page with that in mind, and read the instrument.

Check the source