Jurisdiction(s):
United Kingdom

FCA v WealthTek: High Court stays FCA's civil restitution claim for 12 months pending criminal investigation to preserve restrained assets under POCA (England and Wales)

Published on: 19 March 2024

Published by a LexisNexis Financial Services expert

Legal News

Article summary

Financial Conduct Authority (a company limited by guarantee) v WealthTek LLP (in special administration) and another [2024] EWHC 424 (Ch)

What are the practical implications of this case?

Although this decision shows a civil claim being paused in favour of the criminal process, the court underscored that civil proceedings will not ordinarily be stayed simply because a parallel criminal process is underway or yet to conclude.

Factors that informed the High Court’s approach included that:

the FCA, not the defendants, applied to stay the civil proceedings it had itself issued
the FCA was conducting the relevant regulatory/criminal investigation
the civil claim and any potential criminal proceedings rested on substantially the same facts and allegations
the remedies the FCA sought across the parallel tracks were aligned

It was also significant that the 12‑month stay requested was not considered likely to prejudice the defendants’ rights.

What was the background?

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