Richard Brian Fenech v The Financial Conduct Authority

On a non-disciplinary reference, the Upper Tribunal conducts supervisory review: it remits a prohibition decision only where the decision is outside the range reasonably open to the FCA or requires reconsideration. It may dismiss the reference where the FCA would inevitably reach the same result. The Tribunal cannot direct the FCA to give a future indication that it is minded to revoke an order. Prohibition orders are protective and forward-looking. In setting penalties, the Tribunal gives due regard to FCA guidance but applies it flexibly. Disgorgement should reflect benefits from proven wrongdoing, not every regulatory breach. Interest may be omitted where the circumstances make a charge unjust. For Step 2, relevant income must reasonably measure responsibility for the breach; unrelated business income need not be included.

Richard Brian Fenech owned and operated Financial Solutions Midhurst Ltd, an advisory firm, and Heather Imogen Dunne worked as a pension transfer specialist and the firm’s appointed representative. The FCA imposed penalties under the Financial Services and Markets Act 2000 and prohibition orders on both applicants, following findings of misconduct relating to pension transfer advice, supervision and a backdated appointed-representative agreement.

In its first decision, [2026] UKUT 00162 (TCC), the Tribunal found that both applicants had acted dishonestly in providing the backdated agreement, that Ms Dunne had given unsuitable advice to at least 18% of her clients and had breached her duties, and that Mr Fenech had failed adequately to supervise her but had not acted recklessly. The parties deferred submissions on prohibition and penalties. This decision determines whether the prohibition orders should stand and the appropriate penalties, including the disgorgement amounts and other calculations.

1. Prohibition orders. The references were dismissed insofar as they challenged the prohibition orders. For a non-disciplinary reference under the Financial Services and Markets Act 2000, the Tribunal exercises supervisory rather than full merits review. It must dismiss the reference if the prohibition decision remains reasonably open to the FCA on the Tribunal’s findings. Remittal is appropriate where relevant findings put the decision outside that range, unless the FCA would inevitably reach the same result. The Tribunal applied that approach, drawing on Carrimjee v FCA [2015] UKUT 0079 (TCC), Charles Palmer v FCA [2017] UKUT 0358 (TCC) and John Dee Ltd v Customs & Excise Commissioners [1995] STC 941.

   The findings against Ms Dunne, including dishonesty and unsuitable advice to at least 18% of clients, made her prohibition order reasonably open to the FCA. Although the Tribunal’s findings about Mr Fenech differed from the FCA’s on recklessness and the extent of unsuitable advice, his dishonesty towards the regulator meant the FCA would inevitably impose a prohibition order. The Tribunal had no power to direct the FCA to indicate that it was minded to revoke Ms Dunne’s order after five years. Either applicant may apply to the FCA to vary or revoke an order under section 56(7).

2. Purpose of prohibition. A prohibition order is a protective, forward-looking measure to protect the public, rather than a punishment for past conduct. The Tribunal treated that principle, stated in Staley v FCA [2025] UKUT 00203 (TCC), as relevant to the applicants’ future fitness to perform regulated functions.

3. Penalty framework and disgorgement. FCA penalty guidance is not binding on the Tribunal, but it must be given due regard and applied flexibly to the circumstances. The Tribunal relied on Carrimjee v FCA and Arian Financial LLP v FCA [2024] UKUT 00352 (TCC). Disgorgement is intended to deprive a person of benefits obtained through wrongdoing. It is not proportionate to require disgorgement merely because some regulatory rule was breached. The evidence established unsuitable advice for 18% of Ms Dunne’s clients, so her disgorgement was reduced to 18% of the relevant benefits, or £41,230 after tax. The same percentage was applied to Mr Fenech’s share, producing £5,165. Ms Dunne’s financial hardship did not justify retaining benefits from wrongdoing.

4. Interest and Step 2. Although interest is ordinarily chargeable, it was not appropriate on these facts. The FCA’s unexplained delays, the low interest rates in the first five years, the applicants’ successful challenge to the original penalties and their use of the funds for living costs justified no interest. For Mr Fenech’s Step 2 calculation, the relevant income was £36,269 from work connected with Ms Dunne’s appointed-representative activity, rather than all £240,033 of his FSML income. That figure measured the seriousness of his misconduct and responsibility for the resulting harm; it was not reduced to 18% or adjusted for tax. The Tribunal assessed his breach at Level 4, producing £10,881 at Step 2. With Step 1, his total penalty was £16,046.

5. Orders. The references were dismissed insofar as they concerned the prohibition orders. The Decision Notices were remitted to the FCA with directions to reduce Ms Dunne’s penalty to £41,230 and Mr Fenech’s to £16,046. The Tribunal found those penalties proportionate.

1. Upper Tribunal (Tax and Chancery Chamber): In its first decision, [2026] UKUT 00162 (TCC), the Tribunal determined the applicants’ breaches and deferred the questions of prohibition and penalties.
2. Upper Tribunal (Tax and Chancery Chamber): In this decision, the Tribunal dismissed the references as to the prohibition orders and remitted the penalty decisions to the FCA with directions to reduce the penalties.