ENFG 5.2 The FCA’s general policy

In deciding whether to make a prohibition order and/or, in the case of an approved person, to withdraw its approval, the FCA will consider all the relevant circumstances, including whether other enforcement action should be taken or has been taken already against that individual by the FCA. The FCA will also consider whether enforcement action has been taken against the individual by other enforcement agencies or designated professional bodies.

In appropriate cases, the FCA will take other enforcement action against the individual in addition to seeking a prohibition order and/or withdrawing their approval, including the use of its powers to: impose a financial penalty or issue a public censure; apply for an injunction to prevent dissipation of assets; stop any continuing misconduct; order restitution; apply for an insolvency order or an order against debt avoidance; and/or prosecute certain criminal offences.

The FCA has the power to make a range of prohibition orders depending on the circumstances of each case and the range of regulated activities to which the individual’s lack of fitness and propriety is relevant. Depending on the circumstances of each case, the FCA may seek to prohibit individuals from performing any class of function in relation to any class of regulated activity, or it may limit the prohibition order to specific functions in relation to specific regulated activities. The FCA may also make an order prohibiting an individual from being employed by a particular firm, type of firm or any firm.

The scope of a prohibition order will depend on the range of functions which the individual concerned performs in relation to regulated activities, the reasons why they are not fit and proper and the level of risk which they pose to consumers or the market generally.

Where the FCA issues a prohibition order, it may indicate in the decision notice or final notice that it would be minded to revoke the order on the application of the individual in the future, in the absence of new evidence that the individual is not fit and proper. If the FCA gives such an indication, it will specify the number of years after which it would be minded to revoke or vary the prohibition on an application. However, the FCA will only adopt this approach in cases where it considers it appropriate in all the circumstances. The FCA would not be obliged to revoke an order after the specified period even where it gave such an indication. Further, if an individual’s prohibition order is revoked, they would still have to satisfy the FCA as to their fitness for a particular role in relation to any future application for approval to perform a controlled function.