FINAL NOTICE

ACTION

1. By an application dated 25 September 2022 (“the Application”), Mach 1 Sales

LTD (“Mach 1 Sales” or “the Applicant”) applied under section 55A of the Act for
Part 4A permission to carry on the regulated activities of

a. Agreeing to carry on a regulated activity; and

b. Limited permission Credit Broking

2. The Application is incomplete.

3. The Authority has refused the Application.

SUMMARY OF REASONS

4. Mach 1 Sales has failed to respond to requests for the provision of information

considered by the Authority to be necessary to allow the Application to be
determined.

5. The last request included a statement to the effect that Mach 1 Sales must

contact the Authority within 10 business days, or the Authority would issue Mach
1 Sales with a Warning Notice.

6. By its Warning Notice dated 21 April 2023, the Authority gave notice that it

proposed to refuse the application and that Mach 1 Sales was entitled to make
representations to the Authority about that proposed action by 5 May 2023. No
representations to the Warning Notice were received by this date.

7. As no representations were received by the Authority from Mach 1 Sales within

the time allowed by the Warning Notice, the default procedures in paragraph
2.3.2 of the Authority’s Decision Procedure and Penalties Manual applied,
permitting the Authority to treat the matters referred to in its Warning Notice
as undisputed and, accordingly, to give a Decision Notice.


8. By its Decision Notice dated 19 May 2023 the Authority gave notice that it had

decided to take the action described above.


9. Mach 1 Sales had 28 days from the date the Decision Notice was given to refer

the matter to the Upper Tribunal. No referral was made to the Upper Tribunal
within this period of time or to date.

10. Under section 390 (1) of the Act, the Authority having decided to refuse the

Application and there having been no reference of that decision to the Tribunal,
must give Mach 1 Sales Final Notice of its refusal.

11. The Authority must determine the Application based upon the information

received to date, in circumstances where its requests for information have not
been met. Having reviewed that information, the Authority cannot ensure that
Mach 1 Sales satisfies, and will continue to satisfy, the threshold conditions.

12. Authorised firms (and those seeking authorisation) are expected to engage with

the Authority in an open and cooperative way. The failure to provide the
requested information raises concerns that Mach 1 Sales would fail to do so if the
Application were to be granted.

13. The failure to provide the information raises concerns as to whether Mach 1

a. can be effectively supervised by the Authority as required by threshold

condition 2C;

b. has appropriate human resources, given Mach 1 Sales’ failure to provide the

Authority with the requested information as required by threshold condition
2D; and

c. will conduct its business with integrity and in compliance with proper

standards as required by threshold condition 2E.

DEFINITIONS

14. The definitions below are used in this Final Notice.

15. “the Act” means the Financial Services and Markets Act 2000;

“the Application” means the application referred to in paragraph 1 above;

“the Authority” means the body corporate previously known as the Financial
Services Authority and renamed on 1 April 2013 as the Financial Conduct Authority;

“the Executive Decision Maker” means the member of the Authority’s staff acting
under executive procedures as described in Chapter 4 of the Decision Procedure
and Penalties Manual in the Authority’s Handbook.

“SUP” means the Supervision section of the Authority’s handbook;

“SYSC” means the Senior Management Arrangements, Systems and Controls
section of the Authority’s handbook; and

FACTS AND MATTERS

16. The Application was received by the Authority on 25 September 2022.

17. Further information was requested from Mach 1 Sales under section 55U(5) of

the Act.

18. The Authority has made several separate requests for information from the

Applicant. Amongst other things, the Authority has asked the Applicant for details
surrounding its financial resources.

19. Mach 1 Sales has failed to provide this information despite repeated requests.

Whilst the firm has provided some information to the Authority during the
application process, the information set out above remains outstanding.

20. On 21 March 2023, the Authority sent a letter to Mach 1 Sales by way of email

and recorded delivery, noting the lack of a response to its requests for the
information.

21. The letter also informed the Applicant that a failure to provide the information

would result in the Application being determined based upon the information
received to date, and that this might result in the Authority issuing Mach 1 Sales
with a Warning Notice proposing to refuse the Application. Mach 1 Sales failed to
provide the outstanding information by the stated deadline for response.

22. On 21 April 2023, the Authority sent a Warning Notice to Mach 1 Sales informing

it that any written representations must be made by 5 May 2023. The applicant
was informed that if, having considered representations, or in the absence of any
representations, the Authority decides to refuse the Application, the Authority

will issue a Decision Notice. No representations to the Warning Notice were
received and a Decision Notice was issued on 19 May 2023.

IMPACT ON THRESHOLD CONDITIONS

23. Mach 1 Sales has failed to respond to several separate requests for the provision

of information, considered by the Authority to be necessary to allow the
Application to be determined. The final request gave Mach 1 Sales 10 business
days to respond and included a statement to the effect that Mach 1 Sales must
contact the Authority, or the Authority would issue Mach 1 Sales with a Warning
Notice.

24. The Authority must therefore determine the Application based upon the

information received to date, in circumstances where its requests for information
have not been met. Having reviewed that information, the Authority cannot
ensure that Mach 1 Sales satisfies, and will continue to satisfy, the threshold
conditions and accordingly has decided to refuse the application.

25. Authorised firms (and those seeking authorisation) are expected to engage with

the Authority in an open and cooperative way. The failure to provide the
requested information raises concerns that Mach 1 Sales would fail to do so if the
Application were to be granted.

26. The failure to provide the information raises concerns as to whether Mach 1

a. can be effectively supervised by the Authority as required by threshold

condition 2C;

b. has appropriate human resources, given Mach 1 Sales’ failure to provide the

Authority with the requested information as required by threshold condition
2D; and

c. will conduct its business with integrity and in compliance with proper

standards as required by threshold condition 2E.

PROCEDURAL MATTERS

27. This Final Notice is given under section 390 of the Act.

28. Sections 391(4), 391(6) and 391(7) of the Act apply to the publication of

information about the matter to which this Notice relates. Under those provisions,
the Authority must publish such information about the matter to which this Notice
relates as the Authority considers appropriate. The information may be published
in such manner as the Authority considers appropriate. However, the Authority
may not publish information if such publication would, in the opinion of the

Authority, be unfair to you or prejudicial to the interests of consumers or
detrimental to the stability of the UK financial system.

29. The Authority intends to publish such information about the matter to which this

Final Notice relates as it considers appropriate.

Authority contacts

30. For more information concerning this matter generally, contact Sarah

Whittington-Spivey, Manager, Credit & Lending at the Authority (direct line: 020
7066 5949/ email: sarah.whittington-spivey@fca.org.uk).

ANNEX A – REGULATORY PROVISIONS RELEVANT TO THIS FINAL NOTICE

1. Section 55A(1) of the Act provides for an application for permission to carry on one

or more regulated activities to be made to the appropriate regulator. Section
55A(2) defines the “appropriate regulator” for different applications.

2. Section 55B(3) of the Act provides that, in giving or varying permission, imposing

or varying a requirement, or giving consent, under any provision of Part 4A of the
Act, each regulator must ensure that the person concerned will satisfy, and
continue to satisfy, in relation to all of the regulated activities for which the person
has or will have permission, the threshold conditions for which that regulator is
responsible.

3. The threshold conditions are set out in schedule 6 of the Act. In brief, the threshold

conditions relate to:

(1)
Threshold condition 2B: Location of offices

(2)
Threshold condition 2C: Effective supervision

(3)
Threshold condition 2D: Appropriate resources

(4)
Threshold condition 2E: Suitability

(5)
Threshold condition 2F: Business model

Relevant provisions of the Authority’s Handbook

4. In exercising its powers in relation to the granting of a Part 4A permission, the

Authority must have regard to guidance published in the Authority’s Handbook,
including the part entitled Threshold Conditions (“COND”). The main considerations
in relation to the action specified are set out below.

5. COND 1.3.2G(2) states that, in relation to threshold conditions 2D to 2F, the

Authority will consider whether a firm is ready, willing and organised to comply on
a continuing basis with the requirements and standards under the regulatory
system which will apply to the firm if it is granted Part 4A permission.

6. COND 1.3.3AG provides that, in determining the weight to be given to any relevant

matter, the Authority will consider its significance in relation to the regulated
activities for which the firm has, or will have, permission in the context of its ability
to supervise the firm adequately, having regard to the Authority’s statutory
objectives. In this context, a series of matters may be significant when taken
together, even though each of them in isolation might not give serious cause for
concern.

7. COND 1.3.3BG provides that, in determining whether the firm will satisfy, and

continue to satisfy, the Authority threshold conditions, the Authority will have
regard to all relevant matters, whether arising in the United Kingdom or elsewhere.

Threshold Condition 2C: Effective Supervision

8. COND 2.3.3G states that, in assessing the threshold condition set out in paragraph

2C of Schedule 6 to the Act, factors which the Authority will take into consideration
include, among other things, whether it is likely that the Authority will receive
adequate information from the firm to determine whether it is complying with the
requirements and standards under the regulatory system for which the Authority
is responsible and to identify and assess the impact on its statutory objectives; this
will include consideration of whether the firm is ready, willing and organised to
comply with Principle 11 (Relations with regulators) and the rules in SUP on the
provision of information to the Authority.

Threshold condition 2D: Appropriate Resources

9. COND 2.4.2G(2) states that the Authority will interpret the term 'appropriate' as

meaning sufficient in terms of quantity, quality and availability, and 'resources' as
including all financial resources (though only in the case of firms not carrying on,
or seeking to carry on, a PRA-regulated activity), non-financial resources and
means of managing its resources; for example, capital, provisions against liabilities,
holdings of or access to cash and other liquid assets, human resources and effective
means by which to manage risks.


10. COND 2.4.2G(2A) provides that, ‘non-financial resources’ of the firm include human

resources it has available.


11. COND 2.4.2G (3) states that high level systems and control requirements are in

SYSC. The Authority will consider whether the firm is ready, willing and organised
to comply with these and other applicable systems and controls requirements when
assessing if it has appropriate non-financial resources for the purpose of the
threshold conditions set out in threshold condition 2D.

Threshold condition 2E: Suitability

12. COND 2.5.2G(2) states that the Authority will also take into consideration anything

that could influence a firm's continuing ability to satisfy the threshold conditions
set out in paragraphs 2E and 3D of Schedule 6 to the Act. Examples include the
firm's position within a UK or international group, information provided by overseas
regulators about the firm, and the firm's plans to seek to vary its Part 4A permission
to carry on additional regulated activities once it has been granted that permission.

13. COND 2.5.4G(2)(c)G states that examples of the kind of general considerations to

which the Authority may have regard when assessing whether a firm will satisfy,
and continue to satisfy, threshold condition 2E include, but are not limited to,
whether the firm can demonstrate that it conducts, or will conduct, its business
with integrity and in compliance with proper standards.

14. COND 2.5.6G provides that examples of the kind of particular considerations to

which the Authority may have regard when assessing whether a firm will satisfy,
and continue to satisfy, this threshold condition include, but are not limited to,
whether the firm has been open and co-operative in all its dealings with the
Authority and any other regulatory body (see Principle 11 (Relations with
regulators)) and is ready, willing and organised to comply with the requirements
and standards under the regulatory system (such as the detailed requirements of

SYSC and, in relation to a firm not carrying on, or seeking to carry on, a PRA-
regulated activity only, the Prudential Standards part of the Authority’s
Handbook)in addition to other legal, regulatory and professional obligations; the
relevant requirements and standards will depend on the circumstances of each
case, including the regulated activities which the firm has permission, or is seeking
permission, to carry on.