FINAL NOTICE

Sportz Commercials Ltd

ACTION

1. By an application dated 23 May 2020 (“the Application”) Sportz Commercials Ltd
(“SCL” or “the firm”) applied under section 55A of the Act for Part 4A permission to
carry on the regulated activity of:

i. Limited Permission Credit Broking.

2. The Application is incomplete.

3. The Authority has refused the Application.

SUMMARY OF REASONS

4. By its Warning Notice dated 19 March 2021 (“the Warning Notice”) the Authority
gave notice that it proposed to refuse the Application and that SCL was entitled to
make representations to the Authority about that proposed action.

5. As no representations were received by the Authority from SCL 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.

6. By its Decision Notice dated 5 May 2021 (“the Decision Notice”), the Authority
gave SCL notice that it had decided to take the action described above.

7. SCL 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.

8. 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 SCL a Final Notice of its refusal.

9. The Authority decided to refuse the Application and to give this Final Notice as SCL
has failed to provide the information required by the Authority and, in the absence
of the information sought, the Authority cannot ensure that SCL will satisfy, and
continue to satisfy, all of the threshold conditions set out in Schedule 6 to the Act.

10. SCL has failed to respond substantively, or at all, to six requests for the provision
of information considered by the Authority to be necessary to allow the Application
to be determined. One of the last requests, on 23 November 2020, included a
statement that SCL must contact the Authority within 10 business days, or the
Authority would recommend to the Authority’s Regulatory Transactions Committee
(“RTC”) that that it give SCL a Warning Notice proposing to refuse the Application.
SCL has failed to provide the outstanding information within the deadlines set by
the Authority and to date.

11. The Authority has therefore determined 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 SCL
satisfies, and will continue to satisfy, in relation to the regulated activity for which
SCL would have permission, the threshold conditions for which the Authority is
responsible.

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 SCL would fail to do so if the Application were to
be granted.

13. The failure to provide the information raises concerns as to whether SCL:

a. can be effectively supervised by the Authority as required by threshold
condition 2C;

b. has appropriate human resources, given SCL’s 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.

“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 RTC” means the Authority’s Regulatory Transactions Committee

“the RDC” means the Authority’s Regulatory Decisions Committee

“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

“the Tribunal” means the Upper Tribunal (Tax & Chancery Chamber)

“the Warning Notice” means the warning notice dated 19 March 2021 given to the
applicant by the Authority.

“the Decision Notice” means the decision notice dated 5 May 2021 given to the
Applicant by the Authority.

FACTS AND MATTERS

15. The Application was received by the Authority on 23 May 2020.

16. Further information was requested from SCL under section 55U(5) of the Act.

17. Details of all relevant communications between the Authority and SCL are set out
below:

18. Between 19 October 2020 and 10 December 2020, the Authority sent SCL seven
emails, a letter by recorded delivery and also made three telephone calls to the firm
to obtain information from SCL that the Authority reasonably considered to be
necessary to enable the Authority to determine the Application.

19. On 19 October 2020, the Authority sent SCL an email stating that it considered that
the Application was currently incomplete and that the firm should provide the
following information in support of the Application by 2 November 2020:

i. Confirmation that DBS checks have been completed for the firm’s officers,
including the date that the checks were obtained and whether there is any
information pertaining to those checks which needs to be disclosed to the
Authority;

ii. Confirmation that criminal records checks have been completed for the firm’s
officers including the date that these were obtained and whether there is any

information pertaining to those checks which needs to be disclosed to the
Authority;

iii. Details of why the references from current or previous employers had not
been obtained in respect of the firm’s officers; and

iv. Confirmation as to whether additional regulated activities would be required
by the firm, including debt counselling and debt adjusting.

20. SCL failed to provide the outstanding information by 2 November 2020.

21. On 3 November 2020, the Authority sent an email to SCL noting the lack of response
to its request for information on 19 October 2020 and requesting that SCL provide
the outstanding information by 10 November 2020. SCL failed to provide the
outstanding information by 10 November 2020.

22. On 12 November 2020 the Authority made a telephone call to SCL during which the
firm confirmed receipt of the emails sent on 19 October 2019 and 3 November 2019
and agreed that they would send the Authority the outstanding information by 19
November 2020.

23. On the same date, the Authority sent a follow up email to SCL noting the lack of
response to its request for information made on 3 November 2020 and requesting
that SCL provide the outstanding information by 19 November 2020. SCL failed to
provide the outstanding information by 19 November 2020.

24. On 23 November 2020, the Authority sent a letter to SCL by email and by recorded
delivery requesting that the firm provide the outstanding information within 10
business days, therefore by 6 December 2020. The letter also informed SCL that a
failure to provide the information would result in the Application being determined
based upon the information received to date and that this would result in a
recommendation to the RTC that it give SCL a Warning Notice proposing to refuse
the Application. SCL failed to provide the outstanding information by the deadline
provided of 6 December 2020.

25. On 7 December 2020, the Authority made a telephone call to SCL enquiring as to
why the firm had not yet provided the outstanding information requested and it was
agreed that another telephone call would be scheduled for 10 December 2020. On
the 7 December 2020, the Authority also sent a follow-up email scheduling a
telephone call with SCL for 10 December 2020 to discuss the Application in more
detail. On 8 December 2020, the Authority sent another email to SCL stating that it
was open to the firm to withdraw the Application and to resubmit it, once SCL was
able to demonstrate that it could satisfy the requirements for authorisation.

26. On 10 December 2020, the Authority contacted SCL by telephone as agreed and
stated that the Authority had made requests for the outstanding information since
19 October 2020 and had not yet received any response to the requests. During the
call, the Authority discussed with the firm the option of the firm withdrawing the
Application and then resubmitting the Application once the firm was better prepared.
SCL stated that its preference was to provide the outstanding information and
requested a further extension, explaining that the Covid-19 pandemic and resulting
national lockdown had prevented access to the firm’s laptop.

27. During the call, it was agreed that SCL be granted a final extension of one week to
17 December 2020, within which to provide the outstanding information. The

Authority also stated that, if the outstanding information was not provided by this
date, then this would present concerns that SCL could not be effectively supervised
by the Authority in relation to all the regulated activities for which it would have
permission were the Application to be approved.

28. On 10 December 2020, the Authority also sent an email to SCL following the
telephone call with the firm, noting the lack of a response to the Authority’s requests
for the outstanding information. The Authority requested that SCL provide the
outstanding information by 17 December 2020 to enable a full assessment of the
Application. No response was received from SCL by 17 December 2020, nor to date.

IMPACT ON THRESHOLD CONDITIONS

29. SCL has failed to respond to six separate requests for the provision of information
considered by the Authority to be necessary to enable the Authority to determine
the Application. One of the final requests gave SCL 10 business days to respond
and included a statement that SCL must contact the Authority or the Authority
would recommend to the RTC that it give SCL a Warning Notice proposing to refuse
the Application.

30. 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 SCL
satisfies, and will continue to satisfy, in relation to the regulated activities for which
the firm would have permission, the threshold conditions for which the Authority is
responsible.

31. 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 SCL would fail to do so if the Application were to
be granted.

32. The failure to provide the information raises concerns as to whether SCL:

a. can be effectively supervised by the Authority as required by threshold
condition 2C;

b. has appropriate human resources, given SCL’s 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.

33. On the basis of the facts and matters described above, in particular the failure to
provide the information sought, the Authority has concluded that it cannot ensure
that SCL will satisfy, and continue to satisfy, the threshold conditions in relation to
all of the regulated activities for which SCL would have permission if the application
was granted.

IMPORTANT NOTICES

34. This Final Notice is given under section 390 (1) of the Act.

35. 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.

36. The Authority intends to publish such information about the matter to which this
Final Notice relates as it considers appropriate.

Authority contacts

37. For more information concerning this matter generally, contact Marina Lancaster],
Manager, Credit and Lending Department at the Authority (direct line: 020 7066
5250 / email: marina.lancaster@fca.org.uk).

on behalf of the Regulatory Transactions Committee

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 titled Threshold Conditions (“COND”). The main considerations

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.

8. 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.

Threshold Condition 2C: Effective Supervision
9. 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

10. 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.

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:

(1)
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.