Dear Sir/Madam,

The peer-to-peer lender 'Lendy Limited' (formally known as saving stream) entered administration in May 2019.

Prior to entering administration it is believed that a number of lenders to the company had made complaints to the FCA about Lendy in respect of certain activities and the FCA had ordered Lendy to compensate those lenders.

With the entire organisation now being in administration it is now in the wider public interest to understand the nature of those complaints and the reasoning behind the FCA's decision, and the detail of the order the FCA made to Lendy.

1) Please provide the detail of the order that FCA made to Lendy in respect of this matter.

2) Also please provide any background information that formed the rationale behind the FCA's decision.

3) Finally please provide details of any information the FCA currently has on the degree to which Lendy complied with the FCA's instructions.

It is appreciated that you may not be able to disclose the full detail of the individual complaints made by lenders to the FCA for data protection reasons, but this should not restrict you from disclosing the broader aggregate picture of those complaints and the decision made.

yours sincerely
Owen O'Neill

The Financial Conduct Authority

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Freedom of Information, The Financial Conduct Authority

1 Atodiad

Our ref: FOI6653

 

Dear Mr O'Neill,

 

Freedom of Information: Right to know request

 

Thank you for your request under the Freedom of Information Act 2000 (“the
Act”), dated 25 July 2019, for the following information:

 

“1) Please provide the detail of the order that FCA made to Lendy in
respect of this matter.

 

2) Also please provide any background information that formed the
rationale behind the FCA's decision.

 

3) Finally please provide details of any information the FCA currently has
on the degree to which Lendy complied with the FCA's instructions.

 

It is appreciated that you may not be able to disclose the full detail of
the individual complaints made by lenders to the FCA for data protection
reasons, but this should not restrict you from disclosing the broader
aggregate picture of those complaints and the decision made.”

 

Your request has been considered and I can confirm that we hold
information falling within the scope of your request.  The information we
are able to disclose at this stage is contained in the letter Andrew
Bailey, Chief Executive of the FCA, sent to Lord Myners on 30 July 2019. 
A copy of this letter has been published on our website and can be seen
[1]here.

 

We are unable to disclose any additional details at present in relation to
points 1 to 3 above, as we are of the view that such disclosure would, or
would be likely to, prejudice the exercise by the FCA of its functions for
the purpose of ascertaining whether circumstances which would justify
regulatory action in pursuance of any enactment exist or may arise. This
information is therefore exempt from disclosure under section 31 (Law
enforcement) of the Act.

 

Further, some of the information you are seeking is (or contains)
“confidential information” we have received for the purpose of carrying
out our regulatory functions under section 348 of the Financial Services
and Markets Act 2000 (“FSMA”).  As a result, we are prohibited from
disclosing the information under section 44 (Prohibitions on disclosure)
of the Act.

 

For a detailed explanation of why these exemptions apply, please refer to
Annex A below.

 

If you are unhappy with the decision made in relation to your request, you
have the right to request an internal review.  If you wish to exercise
this right you should contact us within 40 working days of the date of
this response.

 

If you are not content with the outcome of the internal review, you also
have a right of appeal to the Information Commissioner at Information
Commissioner's Office, Wycliffe House, Water Lane, Wilmslow, Cheshire SK9
5AF.  Telephone: 01625 545 700.  Website: [2]www.ico.org.uk

 

Yours sincerely

 

Information Disclosure Team

[3]cid:image001.png@01D4025A.803ED2A0

12 Endeavour Square

London

E20 1JN

 

 

 

 

Annex A

 

 

·                General right of access to information held by public
authorities

 

Under section 1(1)(a) of the Act, any person making a request for
information to a public authority is entitled to be informed in writing by
the public authority whether it holds information of the description
specified in the request.  If the public authority holds information of
the type specified in the request, the person requesting the information
is entitled under section 1(1)(b) of the Act to have the information
communicated to them.  The rights in section 1(1)(a) and (b) are subject
to a number of exclusions and exemptions.

 

·                Section 31 (Law enforcement)

 

The qualified exemption in section 31(1)(g) of the Act applies because,
disclosure of the information requested would, or would be likely to,
prejudice the exercise by the FCA of its functions for the purposes of
ascertaining whether circumstances exist or may arise which would justify
regulatory action in pursuance of any enactment, see section 31(2)(c).

 

This exemption applies in that such information, if disclosed now would,
or would be likely to, prejudice any future enquiries and/or action we may
undertake and may compromise the FCA’s ability to obtain information from
other agencies with associated prejudice to our ability to carry out
investigations.  This exemption is qualified and we have balanced the
public interest for and against disclosure as required by the Act.

 

For disclosure

 

·         There is a strong public interest in favour of transparency and
in the public being reassured about the effectiveness of the regulatory
approach taken by the FCA.

 

·         Disclosure of the information would demonstrate how we respond
to matters arising within the markets we regulate and would enable
regulated firms to better understand why and how we make decisions on
regulatory matters.

 

·         Disclosure would also provide the public with information to
assist them in making decisions about their dealings, or potential
dealings, with the markets and firms that are operating in the financial
services sector.

 

Against disclosure

 

·         Disclosure of the information could lead to further speculation
which, in the absence of any further background information, could be
taken out of context and could lead to the wrong conclusions being drawn
in respect of our decision-making processes.

 

·         Disclosure could also affect the brand and reputation of the
relevant markets and/or entities in the absence of due process having been
followed – i.e. in the absence of any formal public announcement and
without the relevant markets and/or entities having had the opportunity to
comment.

 

On the facts of this particular request, we have concluded that the
balance of the public interest is in favour of maintaining the exemption
under section 31 of the Act, for the reasons set out above.

 

·                Section 44 (Prohibitions on disclosure)

 

Section 44(1)(a) provides that information is absolutely exempt if its
disclosure (otherwise than under the Act) is prohibited by or under any
enactment.

 

Section 348 of FSMA restricts the FCA from disclosing "confidential
information" it has received except in certain limited circumstances (none
of which apply here).

 

Confidential information for these purposes is defined as information
which relates to the business or other affairs of any person and which was
received by the FCA for the purposes of or in the discharge of its
functions under FSMA and which is not in the public domain.

 

In this instance, the information received by the FCA was received for the
purpose of carrying out its regulatory functions and so falls within
section 348 of FSMA. Consequently, the FCA is prohibited from disclosing
it to you.

 

Disclosure of any such “confidential information” is in breach of section
348 of FSMA and is a criminal offence.

 

Section 44 of the Act contains an absolute exemption and so it is not
necessary to balance the public interest for and against disclosing the
information.

 

 

 

This communication and any attachments may contain personal information.
For more information about how and why we use personal information and who
to contact with any queries about this, please see our privacy notices:
FCA Privacy Notice (https://www.fca.org.uk/data-protection) and PSR
Privacy Notice
(https://www.psr.org.uk/cookies-privacy-a...).

This communication and any attachments contain information which is
confidential and may be subject to legal privilege. It is for intended
recipients only. If you are not the intended recipient you must not copy,
distribute, publish, rely on or otherwise use it without our consent. Some
of our communications may contain confidential information which it could
be a criminal offence for you to disclose or use without authority. If you
have received this email in error please notify [email address]
immediately and delete the email from your computer. Further information
on the classification and handling of FCA information can be found on the
FCA website
(http://www.fca.org.uk/site-info/legal/fc...).

The FCA (or, if this email originates from the Payment Systems Regulator
Limited, the FCA on behalf of the Payment Systems Regulator Limited / the
Payment Systems Regulator Limited) reserves the right to monitor all email
communications for compliance with legal, regulatory and professional
standards.

This email is not intended to nor should it be taken to create any legal
relations or contractual relationships. This email has originated from the
Financial Conduct Authority (FCA), or the Payment Systems Regulator
Limited.

The Financial Conduct Authority (FCA) is registered as a limited company
in England and Wales No. 1920623. Registered office: 12 Endeavour Square,
Stratford, London, E20 1JN, United Kingdom

The Payment Systems Regulator Limited is registered as a limited company
in England and Wales No. 8970864. Registered office: 12 Endeavour Square,
Stratford, London, E20 1JN, United Kingdom

Switchboard 020 7066 1000

Web Site http://www.fca.org.uk (FCA); http://www.psr.org.uk (the Payment
Systems Regulator Limited)

References

Visible links
1. https://www.fca.org.uk/publication/corre...
2. http://www.ico.org.uk/