On 22 July 2025, the Financial Conduct Authority (FCA) issued a Final Notice, imposing a financial penalty of £1,049,500 and a prohibition order on Jean-Noel Yves Alba, the former deputy chief executive officer of the asset management company H2O AM LLP (H2O).
Background
H2O was an authorised fund manager for a number of funds (H2O Funds). During the relevant period, H2O made a series of investments through the funds it managed to entities controlled or introduced by Lars Windhorst (the Investments). These investments differed significantly from the vast majority of traditional investments made by the H2O Funds and were highly illiquid. It later became clear that H2O and Lars Windhorst had a close relationship. On 2 August 2024, the FCA issued a Final Notice to H2O in relation to the Investments.
During the FCA's investigation, it was found that Mr Alba failed to act with integrity and to be open and cooperative with the FCA's investigation on multiple occasions. In particular, he:
- directed retrospective creation of records and minutes of governance and oversight committee meetings, many of which had not taken place at all, and provided false and misleading documents to the FCA;
- provided misleading due diligence reports relating to the Investments which purported to evidence contemporaneous analysis of initial investment decisions but were prepared subsequently, often many months after the Investments had been made; and
- made misleading statements in correspondence to the FCA regarding the nature and extent of due diligence H2O had conducted on the Investments.
He also failed to correct or amend the inaccurate and misleading statements and documents when he was aware that the timing and extent of due diligence was central to the FCA's investigation of H2O's decision to enter the Investments.
By reason of the above, the FCA found that Mr Alba breached Statement of Principles 1 and Individual Conduct Rule 1 (lack of integrity) and Statement of Principle 4 and Individual Conduct Rule 3 (failure to be open and cooperative in his interactions with the FCA).
Penalty
In determining the penalty, the FCA considered the breaches to be serious because they were deliberate; Mr Alba made false and misleading statements on multiple occasions; and he utilised his senior position to cause or encourage more junior colleagues to retrospectively create and amend documents to provide to the FCA.
Mr Alba's failure to bring the breaches quickly to the FCA's attention, to cooperate during the investigation and to take remedial steps to stop the breaches were considered aggravating factors resulting in a further increase of 10% in the penalty.
By reason of the finding of a lack of integrity, the FCA considered that Mr Alba was not a fit and proper person to carry out any functions in any regulated activities. Mr Alba is therefore also prohibited from performing any function in relation to regulated activities.
Comment
The FCA's findings against Mr Alba (and those in the case of Mr Staley) are a reminder of the seriousness of misleading the regulator. The FCA relies on accurate and honest information from regulated firms to carry out its supervisory functions. Any attempt to mislead the FCA is a fundamental breach of principle 11 and can lead to serious consequences including both a fine and a prohibition order or worse.
The FCA in this case chose to use its regulatory powers to punish Mr Alba. However, s177 of the Financial Services and Markets Act 2000 establishes offences of falsifying evidence and providing false and misleading information to the regulator. These offences can be prosecuted by the FCA and are punishable by an unlimited fine or up to two years imprisonment.