Financial Conduct Authority v WealthTek LLP & Anor (Re Financial Services and Markets Act 2000) [2024] EWHC 424 (Ch) (01 March 2024)

Financial Conduct Authority v WealthTek LLP & Anor (Re Financial Services and Markets Act 2000) [2024] EWHC 424 (Ch) (01 March 2024)

The High Court Proceedings are, at least in part, 'proceedings in respect of property' within s.58(5) of the Proceeds of Crime Act 2002 due to the relief sought and the overlap with assets restrained under the criminal restraint order. The interests of justice require a 12-month stay to prevent unnecessary depletion of realisable assets, to allow the FCA to prioritise its criminal investigation, and because any prejudice to Mr Dance is minimal and does not outweigh these factors. The legislative steer in s.69(2) supports the stay. The application is granted.

Citation
[2024] EWHC 424 (Ch)
Parties
Claimant: The Financial Conduct Authority; First Defendant: WealthTek LLP (in special administration); Second Defendant: Jonathan Edward Dance
Jurisdiction
England and Wales
Judgment Date
01 March 2024
Procedural Posture
Application to Stay Proceedings / Interlocutory Application for 12 Month Stay Pending Potential Criminal Charges
Outcome
Application granted; 12-month stay ordered
Legal Topics
Stay of Proceedings, Overlap of Civil and Criminal Proceedings, Asset Freezing and Restraint Orders, Regulatory Enforcement, Fraud, Money Laundering
Financial Regulation Civil Procedure Criminal Law Stay of Proceedings Overlap of Civil and Criminal Proceedings Asset Freezing and Restraint Orders Regulatory Enforcement Fraud +1 more

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Parties

The Financial Conduct Authority

Claimant

WealthTek LLP (in special administration)

First Defendant

Jonathan Edward Dance

Second Defendant

Procedural Posture

Application to Stay Proceedings / Interlocutory Application for 12 Month Stay Pending Potential Criminal Charges

Legal Issues

  1. 1 Whether the High Court Proceedings should be stayed for 12 months pending the FCA's decision on criminal charges against Mr Dance
  2. 2 Whether s.58(5) of the Proceeds of Crime Act 2002 applies to these proceedings
  3. 3 Whether the interests of justice require a stay given the overlap between civil and criminal matters and the existence of a criminal restraint order

Ratio Decidendi

The High Court Proceedings are, at least in part, 'proceedings in respect of property' within s.58(5) of the Proceeds of Crime Act 2002 due to the relief sought and the overlap with assets restrained under the criminal restraint order. The interests of justice require a 12-month stay to prevent unnecessary depletion of realisable assets, to allow the FCA to prioritise its criminal investigation, and because any prejudice to Mr Dance is minimal and does not outweigh these factors. The legislative steer in s.69(2) supports the stay. The application is granted.

Court Disposition

Application granted; 12-month stay ordered

Orders

  • High Court Proceedings stayed for 12 months from the date of the order
  • FCA to apply to discharge the interim prohibitory injunction (IPO) against Mr Dance