The Upper Tribunal has upheld a decision by the FCA to refuse approval for an individual to carry out regulated activities. Saranac Partners Limited is a wealth and investment management firm founded in 2015 by Thomas Llewellyn Kalaris (K). K had previously been employed by Barclays Bank.

In September 2020, Saranac applied to the Financial Conduct Authority for approval under section 60 of the Financial Services and Markets Act 2000 for K to perform the Chief Executive and Executive Director functions for Saranac. In November 2022, the FCA refused the application.  It said that there were reasonable grounds for considering that in interviews with the FCA in relation to two different investigations while K had been at Barclays (capital raising and a so-called GenVen report), K failed to be open and cooperative and gave untrue and misleading evidence. Therefore, the FCA was not satisfied about his honesty and integrity.

In December 2022, Saranac referred the FCA’s decision to the Tribunal.

The Tribunal’s decision

In relation to the capital raising, the Tribunal made findings of fact based on the same documentary evidence that the FCA considered, along with K’s witness evidence. It found that K had not been candid when answering three questions and that one answer was dishonest. Therefore, it drew the same conclusions as the FCA. 

With regard to the GenVen report, the tribunal did not rely on the FCA's evidence (which included the findings made in another tribunal judgment). It considered evidence that the FCA had not taken into account:

• K complied with the restrictions imposed on him by the FCA to March 2020. The FCA Handbook confirms that a relevant factor when assessing a person’s fitness and propriety is “whether the person demonstrates a readiness and willingness to comply with the requirements and standards of the regulatory system”. However, the tribunal also considered that both Saranac and K were mandated to comply with the attestation process as a condition of Saranac’s authorisation, and a failure to comply would have had serious consequences for that firm. 
• In the course of his work for Saranac, witnesses said K acted with fitness and propriety. 

The Tribunal said that these findings were inconsistent with the FCA’s decision. However, it also believed that they were significantly outweighed by the seriousness of the findings about K’s dishonesty and lack of candour.

It noted that K had not shown any signs of remorse; he maintained that he had acted entirely appropriately and claimed to have been entirely open and honest with the FCA. 

It had no doubt that if the matter were remitted back to the FCA, it would inevitably come to the same conclusion. It also found that the position would be the same if it made a finding of dishonesty in relation to only one of the interviews. It therefore dismissed the reference unanimously.

The case illustrates the pitfalls of steadfastly maintaining one’s original position. K did not show remorse, and made no attempt to rehabilitate from a previous integrity failing through passage of time.