The Upper Tribunal has rejected an appeal from mortgage broker Abdul Razzaq regarding the FSA’s decision to ban him from regulated activity.
The FSA argued Razzaq’s actions have established him as “dishonest, lacking in integrity and reputation, lacking in competence and capability, and lack[ing] adequate resources” and its decision to ban him was appropriate.
The FSA says Razzaq fraudulently obtained an unauthorised overdraft of £22,200 from Whiteaway Laidlaw Bank, which has since rebranded to Shawbrook Bank, by falsely representing that he had paid £22,120 in cash to his account. When later questioned on this conduct by the bank, the FSA and Birmingham County Court, Razzaq gave differing explanations.
Razzaq paid in two cheques amounting to £12,000 on 30 April. On the basis of this incoming money, WLB agreed to pay out a cheque of £10,000.
The FSA alleged Razzaq misrepresented the payment as cash rather than by cheques, in order to obtain this credit which Razzaq denies. The actual cheques were then dishonoured which resulted in an unauthorised overdraft position.
On 1 May, Razzaq paid three further cheques into the account, totalling £10,120. A credit slip showing the deposits as cash was presented to a cashier who stamped it before noticing the error. Although a corrected slip was then presented, showing the deposits as cheques, the initial slip was sent to WLB and resulted in the bank releasing a further £9,600 and the transfer of two smaller amounts.
The Upper Tribunal ruled the FSA’s evidence for the events on 30 April was not strong enough to definitively prove fraudulent behaviour. The evidence for the events on 1 May was much stronger and the Upper Tribunal upheld the claim that Razzaq had obtained £10,000 from Whiteaway Laidlaw Bank by deliberate fraud.
Between November 2008 and January 2009, Razzaq is charged to have kept a “significant sum” of client money in an account held in the name of his nephew and another third party.
The FSA also alleged Razzaq continued to carry out regulated insurance mediation activity after his permissions were withdrawn in March 2009.
The Upper Tribunal reached a unanimous decision to reject Razzaq’s appeal and said that a full prohibition order was necessary to protect consumers and prevent financial crime.