FSA fines chief executive
The misleading information related to a signed letter supplied to the FSA on 30 September 2004 confirming the intention of seven directors of the merged company, including Mr Tebbutt, to provide a directors’ guarantee of £3 million supported by unencumbered assets of the same amount.
Mr Tebbutt failed to ensure that there were sufficiently firm intentions by the directors concerned to commit at this level and that they were adequately recorded. Subsequently from at least 4 October to 13 October 2004, Mr Tebbutt, after learning that the full guarantee could not be provided, failed to inform the FSA of this crucial information.
The signed letter of intent was an important consideration in the FSA’s decision to approve the merger on 30 September. In the event the £3 million guarantee was never provided.
Margaret Cole, FSA Director of Enforcement, said:
“It is vital for effective regulation that information provided to the FSA by approved persons and firms is accurate so that the FSA can make properly informed regulatory judgements. A decision whether to approve a change of control for a firm is a particularly significant decision for the FSA with potential for serious detriment to consumers. In this case it was essential that the FSA could rely on Mr Tebbutt to provide accurate and reliable information and to advise promptly when aware this did not remain the case. The FSA will take action against individuals and firms that provide misleading information in this way.”