FSA succeeds with rare stockbroker prosecution

The Financial Services Authority (FSA) has successfully prosecuted an unauthorised stockbroker who stole over £350,000 from clients between 1997 and 2004.

In London’s Central Criminal Court on Monday (11 February) William Anthony ‘Robin’ Radclyffe pleaded guilty to 15 offences and was sentenced to 15 months. He was also disqualified from being a company director for five years.

Part of the case brought against Radclyffe centred on him stealing an investment portfolio valued at just under £100,000, dishonestly failing to return £20,000 owed to his former partner and defrauding a number of investors, many of whom were friends.

Because Radclyffe was not an authorised broker his clients were unable to access compensation via the Financial Ombudsman Service or the Financial Services Compensation Scheme.

In sentencing Radclyffe Mr Justice Wiggs said: “You knew your actions were unlawful and those who suffered would not have course to recompense.”

The FSA’s director of enforcement Margaret Cole said others considering engaging in dishonest conduct should take note of the custodial sentence imposed on Radclyffe.

“Our prosecution of this case is indicative of the FSA’s determination to deter wrongdoing of this sort,” she added.

The FSA used its in-house enforcement legal team, headed by Daniel Thornton, on the case. In-house barrister Sarah Clarke represented the regulator in court. Radclyffe turned to Chris Beckett of Salisbury firm Richard Griffiths & Co.

The FSA has the power to bring prosecutions under the Financial Services and Markets Act 2000, but its use of this power is rare. It brought its first prosecution in 2005, when Carl Rigby, ex-chairman and chief executive officer of software company AIT, and Gareth Bailey, its former financial director, were found guilty of recklessly making a statement to the market which was misleading, false or deceptive. Rigby was sentenced to three and a half years imprisonment and disqualified from being a director for six years while Bailey received two years’ imprisonment and was disqualified from being a director for four years.

The FSA can also bring criminal proceedings under the Banking Act 1987, a power that was transferred from the Bank of England in 1998. The regulator has taken a number of such actions, including the successful prosecution of Birmingham chartered accountant Paul Haslam in 2000.

Haslam was sentenced to nine months for defrauding 10 customers and one employee to the tune of £60,000, which he used to buy a nightclub in Birmingham.