THE ROLE OF THE FINANCIAL CONDUCT AUTHORITY IN REGULATING LONDON CAPITAL AND FINANCE

That this House notes the report of the administrators on the affairs of London Capital and Finance, which went into administration in January owing more than £230 million to more than 11,000 bondholders; further notes that the Serious Fraud Office and other crime agencies are investigating what the administrators described as highly suspicious transactions, which have resulted in much of the bondholders money being in the possession of or under the control of just four people, and that four people have subsequently been arrested; expresses alarm that documentary evidence has come to light which shows that the FCA was alerted to the activities of London Capital and Finance back in November 2015, but the FCA still went ahead and gave the firm a FCA-regulated accreditation on 7 June 2016, albeit for only the promotion part of their activities, which enabled London Capital and Finance to raise money from bondholders by marketing themselves as FCA-regulated in their promotional literature; believes that the Financial Conduct Authority has a major responsibility in allowing London Capital and Finance to raise more than £230 million from more than 11,000 people, many of whom are elderly and invested their life savings in the bonds; and believes that, as London Capital and Finance was an FCA-regulated company, the chief executive of the FCA should resign for presiding over the biggest financial scandal of recent years, which is likely, according to the administrators, to result in more than 11,000 bondholders losing all or most of their money.