FCA opposes acquisition of Kimberly Forex
The UK Financial Conduct Authority (FCA) today published a final notice concerning the acquisition of Kimberly Forex UK Limited, now known as Transfer Gurus. The regulator voices its concerns and opposes the deal.
The firm was established on 21 March 2017 as Kimberly Forex UK Limited. It changed its name to Ipayguru Limited on 17 July 2019 and subsequently to Transfer Gurus Ltd on 2 December 2019.
Ms Sherrie Jean Thackray acquired 100% ownership of the firm on September 1, 2019. This information is based on the Companies House records and Ms Thackray’s email to the Authority dated 11 September 2020. Ms Thackray is a British national and a UK resident but has indicated in her email on 10 September 2020 that at the time, she was in the United Arab Emirates. According to the Companies House Register, she is the only active director at the Firm.
The FCA notes that Thackray submitted the Notification to the Authority on 25 August 2020, almost a year after the acquisition. In her email to the Authority dated 11 September 2020 Ms Thackray clarified that she “became 100% shareholder before receiving FCA approval”.
Also, the information provided by the notice giver is incomplete.
On 16 September 2020, the Authority explained the post notification implications to Ms Thackray, including that it is a criminal offence to acquire control without the Authority’s approval. Ms Thackray did not respond to this email or to the subsequent two emails from the Authority on 29 September and 13 October 2020. To date the Authority has not received a response from Ms Thackray.
Section 191A(3)(b) of the Act states that in objecting to a person’s control over an authorised firm, the Authority may take into account whether the person has cooperated with any information requests made. Accordingly, in reaching its decision, the FCA took into account Ms Thackray’s lack of response to the Authority’s repeated requests for information.
Since its registration, including following the Acquisition, the firm has failed to register with the HMRC for the purposes of MLRs 2017. Registration with HMRC is one of the conditions for registration as an SPI under Regulation 14 of the PSRs 2017.
In addition, in the period between October and December 2019, i.e. post- Acquisition, the Firm changed its address, name and directors, yet it first contacted the Authority in relation to updating its details on 10 February 2020.
The firm does not appear to have a principal user for Gabriel and has not submitted regulatory returns on Gabriel since its registration. It currently has 14 returns outstanding since 31 December 2018. This is despite the contacts made in February and August 2020 by the firm and Ms Thackray set out above regarding accessing and using the Authority’s reporting systems. Therefore, the Authority has no information on the firm’s operations since registration.
All of these failings raise serious concerns about the acquisition, according to the FCA. The Authority considers that the they provide reasonable grounds for objecting to the change in control.
The Authority considers that Ms Thackray’s failure to seek and obtain the Authority’s approval prior to the Acquisition and her subsequent failure to respond to the Authority’s information requests, raise concerns regarding both her integrity and professional competence and constitute reasonable grounds to question Ms Thackray’s reputation. This is of particular concern given that Ms Thackray is the sole controller of the firm.
The FCA particularly considers the fact that having failed to comply with the obligation to notify the Authority of the Acquisition, Ms Thackray is in effect guilty of an offence. Having been informed of this on numerous occasions, she failed to promptly address the Authority’s concerns about the criminal conduct which casts doubts on her integrity.
Furthermore, the Authority considers the fact that the firm’s failure to meet its regulatory requirements persisted after the acquisition, significantly that it has failed to register with the HMRC, strongly suggests that the persons directing its business do not possess appropriate knowledge, skills and experience to ensure the sound and prudent conduct of its affairs.
The FCA considers that the absence of the controller from the UK (given that Ms Thackray appears to be based in UAE), coupled with the continuous lack of registration with the HMRC, constitutes reasonable grounds that in connection with the Acquisition the risk of money laundering activities could increase.