Misleading statements under the Financial Services Act 2012

Produced in partnership with James Alleyne of Kingsley Napley

Practice notes

Misleading statements under the Financial Services Act 2012

Produced in partnership with James Alleyne of Kingsley Napley

Practice notes

Offences relating to financial services

The Financial Services Act 2012 (FSA 2012) created three offences relating to market manipulation where, formerly under section 397 of the Financial Services and Markets Act 2000 (FSMA 2000), there were only two offences (Misleading statements and misleading practices). Following the commencement of FSA 2012 on 1 April 2013 the section 397 offences were repealed. The offences created by FSA 2012 are:

•
making False or misleading statements or dishonestly concealing material facts under FSA 2012, s 89
•
creating false or misleading impressions under FSA 2012, s 90, and
•
making false or misleading statements etc in relation to benchmarks under FSA 2012, s 91

See also Practice Notes: Misleading statements etc in relation to benchmarks and Misleading impressions under Financial Services Act 2012.

For information on the previous regime for market manipulation under FSMA 2000, s 397, see Practice Note: Misleading the market and market manipulation under s 397 FSMA 2000 [Archived].

Misleading statements—elements of the offence (the criminal act)

A person commits a misleading statement

James Alleyne

Solicitor, Kingsley Napley

James is Legal Director in the firm’s Financial Services Group. He advises clients on the full spectrum of financial services and FCA-related matters, including on authorisation applications, perimeter and supervisory issues, enforcement investigations and cases before the Regulatory Decisions Committee and Upper Tribunal.

James joined Kingsley Napley in 2022 from the FCA where he spent seven years in the Enforcement division, giving him a unique insight into the approach and working of the regulator.

Whilst at the FCA James built the framework, and led the dedicated team responsible, for taking assertive supervisory intervention action against firms through the imposition of requirements, freezing of assets, banning of financial promotions and variations of permissions. James led many of the FCA’s highest profile interventions to date, including the banning of the world’s largest crypto exchange.

James also has significant experience of advising on FCA criminal and regulatory enforcement investigations into firms and individuals and conducting related litigation, including in relation to conduct issues, systems and controls failings, conflicts of interest and compliance with anti-money laundering legislation and cases involving sexual misconduct in the workplace. James also has extensive experience in advising on contested authorisations cases for firms, senior individuals and in respect of changes in control.

Jurisdiction(s):

United Kingdom

Key definition:

Misleading definition

What does Misleading mean?

The Trade Descriptions Act 1968 (TDA 1968), s 3(2) provides that a trade description which, though not false, is misleading in that it is likely to be taken as an indication of such of the matters specified in TDA 1968, s 2 and, as such an indication, would be false to a material degree, shall be deemed to be a false trade description.

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