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Moving outside of the regulatory perimeter

Earlier in the year, the FCA published a report which flagged up their concerns about companies operating on the edge of the regulatory perimeter and stated “The boundary between which firms and activities do or don’t require regulation, is being constantly tested. The recent behaviour of some firms operating around the perimeter has caused serious consumer harm and reduced trust in regulated financial services markets.”


As the PPI deadline has passed and CMC’s are going through an intensive authorization process or indeed given up their permissions altogether, it would seem that the option of operating on the cusp is perhaps much more appealing, meaning sectors such as lead generators, debt advice providers or investment vehicles that specialise in non-FCA regulated investments could be an attractive option.


Background

Back in September 2017 and following a 3 year investigation[1], a BBC reporter confronted two men who had been responsible for sending nuisance text messages. Andrew Horner-Glister and Barry Sanders, who ran several businesses, told an undercover reporter from Inside Out West Midlands they sent "60 million texts a month".[2]


The pair said when they did it up until 2012, it was legal. But the Information Commissioner's Office, which regulates the industry, said it's been illegal since 2003.


In July 2017, an initial BBC article had reported how a watchdog was investigating a premium-rate texting campaign, following complaints from recipients that they have been charged fees even though many believe they never opted into the service. The BBC became aware of the campaign when one of its reporters received a text in June.




The company behind the campaign was called Pro Money Holdings Ltd which had been set up in 2014 by Barry Sanders and Andrew-Horner Glister and is currently suspended from being struck off.[3] Both men were also the directors of Pro Money Ltd which was ordered to wind up following a petition from HMRC in September 2017.[4]


At the time, the pair said they have not distributed text messages themselves since 2012 and claim when they did it was legal, however the BBC discovered that companies under their control continued to sell on leads generated from indiscriminate text messages.[5]



Fast Forward to today – what are they doing now?


Barry Sanders set up Bee Marketing Services Ltd in October 2018 but earlier this year he re-named it a more impressive sounding, Montague Capital Investments Ltd which according to their website are specialists in investment with clients who are predominantly High Net Worth investors.


Each project is reviewed and approved before fundraising can begin and the website offers social media tools to share the project with potential investors who can subsequently invest via an online payment system.


The website is littered with risk warnings that it does not provide advice, investments are not covered under FSCS and access to the Financial Ombudsman Service is not available.

Montague Capital Investments Ltd appears to be one of a growing band of investment vehicles that specialise in non-FCA regulated investments and is operating outside the FCA regulatory perimeter.


Yet, according to its terms and conditions page it is ‘an appointed representative of a legal entity’ but the entity is unnamed and Montague Capital Investments Ltd does not appear to be on the FCA register. It does reference Saatchi Holdings PLC, an Asset Based Lender, on its website, but this also does not appear to be FCA regulated.





In November 2017, Andrew Horner-Glister became a director of the CMC, House and Home Care Ltd whose license lapsed on 31st August 2019.[6] The CMC had two trading names which included Jonas Financial - the same name of the active company set up by Horner-Glister in 2011[7] which provides “a tailored marketing solution for the Gambling, Retail and Lead Generation Markets”[8].



Other Links


Lead generation is something both Messrs Horner-Glister and Sanders are familiar with and past links have included Levine Financial Ltd which they set up with Nicky Ormerod in 2014. Ormerod is the director of the current CMC, Savvy Claims Ltd which was the subject of two of our blogs - Connections and Savvy Claims Ltd.


A further connection is Ms Carley Jones who was a director of Pro Money Ltd at the same time as Horner-Glister and Sanders. At the same time she also worked alongside Nicky Ormerod at NAEH Ltd – a pension enrolment company which was wound up the Insolvency Service in 2018 for misleading new members.[9]

[1] https://datajournalismawards.org/projects/text-message-marketing-the-trade-in-illegal-data-capture/

[2] https://www.bbc.co.uk/news/av/uk-england-41257585/undercover-reporter-confronts-spam-text-message-pair

[3] https://beta.companieshouse.gov.uk/company/09047321/filing-history

[4] https://beta.companieshouse.gov.uk/company/08939231/filing-history

[5] https://www.dailymail.co.uk/news/article-4893686/Pair-admit-sending-2MILLION-nuisance-text-messages-day.html

[6] https://register.fca.org.uk/ShPo_FirmDetailsPage?id=0010X00004QQuDlQAL

[7] https://beta.companieshouse.gov.uk/company/07562684/filing-history

[8] https://www.linkedin.com/in/andrew-horner-glister-9387106b/?originalSubdomain=uk

[9] https://www.gov.uk/government/news/pension-enrolment-companies-wound-up-for-misleading-new-members

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