UT (Tax & Chancery) UT/2023/000050 - [2025] UKUT 00123 (TCC)

Mr Reynolds says that he did not act without honesty or integrity but does not go on to articulate any case to substantiate this position. For example, his application does not state (i) whether Mr Reynolds accepts he received commissions in the sums set out in the Decision Notice; (ii) whether he believed such commissions were permitted (and if so, why); (iii) whether he accepts that such payments gave rise to a conflict of interest; or (iv) any explanation for the structures by which those commissions were received by him. These are fundamental aspects of the case against Mr Reynolds in the Decision Notice. It was imperative that Mr Reynolds’ proposed case in response to these allegations be set out clearly and precisely.

Mr Reynolds does not say what he claims to have been told by Greyfriars about P6, when, by whom or how. He has not set out what he will contend his understanding was of P6 at the time in light of such information: for example, whether he understood P6 was high risk, whether he understood it comprised investments in illiquid mini-bonds. He has also not attempted to explain why, on the basis of such information/understanding, he considered such investments could be appropriate for the hundreds of Active Wealth clients who invested in P6. Mr Reynolds would need a positive case on such matters in order to challenge this aspect of the Decision Notice, and it was incumbent upon him to set out such a case in the application.

The application does not articulate any case in response to the allegation that Mr Reynolds made false statements in P6 application forms in order to present Active Wealth clients as meeting P6’s criteria for investors. It is therefore unclear whether Mr Reynolds accepts that the statements in issue were false. Nor is it apparent what his explanation would be for signing P6 application forms containing statements about the position of Active Wealth customers which were contradicted or unsupported by the documentation on their files. The application does not grapple with the fundamental point that, even if customers wished to invest in P6, if they did not meet Greyfriars’ own criteria for such investments, Mr Reynolds should not have signed application forms claiming they did.

Whilst Mr Reynolds asserts that he will show that “the advice given addressed the wants of the clients, and indeed, met them”, Mr Reynolds has not sought to articulate, even in the broadest terms, what he says his advice was, still less why he says he thought it was appropriate. The Authority infers, from his statement that the suitability reports accurately summarised his advice, that Mr Reynolds wishes to argue that he advised members of the BSPS against transferring out of the scheme, but he does not actually say this anywhere. Mr Reynolds does not say whether it is his case that almost all of the 146 members of BSPS whom Active Wealth advised during period of March to November 2017, rejected his advice when they transferred their pension to a SIPP, nor has he set out any other explanation for why these BSPS members chose to transfer out of the BSPS, apparently against his express advice.

The Authority understands that Mr Reynolds wishes to say that the suitability reports accurately summarised the advice which he had given orally to Active Wealth clients. So far as it goes, that is a relatively clear contention, but the evidence which Mr Reynolds says he wishes to rely on to make this good however, simply will not support this. The fact that third parties, including (initially) the Authority, did not spot that the suitability reports set out a false account of the advice given by Mr Reynolds, would not demonstrate that they accurately recorded Mr Reynolds’ advice: third parties, who reviewed only the suitability reports themselves, or otherwise advised as to their form and content, would have had no reason to know that they did not summarise the advice actually given by Mr Reynolds. Mr Reynolds has therefore not identified any evidence which would corroborate a case that the suitability reports reflect the advice he actually gave.

As regards the non-disclosure of exit fees charged by certain funds into which Active Wealth clients’ pensions were invested, Mr Reynolds does not state what “the document issued to clients that states the potential exit fees” is. Without identifying the document, and the passage or passages within it which he relies on, it is wholly unclear what Mr Reynolds’ case that he gave proper disclosure will be. He also does not explain when the document in question was, on his case, issued to clients, or how he will show how many clients the document he relies on was issued to.

Mr Reynolds has not explained matters such as whether he would say that he introduced the advisers to Active Wealth clients and if so, in what terms he did so, nor whether he would say he briefed the advisers as to the importance of not giving pension transfer advice. Mr Reynolds has also not explained whether it would be his case that he met with all Active Wealth clients who were assisted by the advisers in question, and advised them personally (nor how he would rebut the Authority’s evidence, direct from Active Wealth clients, that they never met Mr Reynolds). Again, if Mr Reynolds had a real prospect of defending this finding, he ought to be able to set out such matters clearly and succinctly.

Mr Reynolds says that he answered “the questions put to me openly and honestly”, which the Authority understands to be a reference to the questions asked by the Authority in interview. In the Decision Notice Mr Reynolds’ answers to questions in interviews with the Authority is only one of the various ways in which he is found to have misled the Authority and the Insolvency Service. Whether Mr Reynolds’ answers in interviews with the Authority were honest could only be assessed after considering the true position. Since Mr Reynolds has not set out any clear case on the allegations of the Authority in respect of which his answers in interview were found to have been dishonest, the Tribunal will not be able to determine whether Mr Reynolds’ answers in interview were honest.

Mr Reynolds addresses this allegation in a single sentence. The Authority understands Mr Reynolds to say that he was negligent (but not reckless) in “cancelling the subscription without knowing that all previous emails would be lost.” Mr Reynolds has not said however:

The Authority ought not be required to speculate as to what Mr Reynolds may eventually say about such matters; if he wishes to challenge the Authority’s finding, he ought to be able to articulate a case which covers these obvious points. Mr Reynolds’ failure to set out an intelligible and straightforward case, even on this point (which is relatively minor in the context of the Decision Notice as a whole) is symptomatic of his general approach to the application.