The Financial Conduct Authority (FCA) has brought significant criminal charges against John Dance, the former principal partner of WealthTek LLP (formerly Vertus Asset Management LLP). The allegations involve multiple counts of fraud and money laundering, painting a picture of large-scale financial misconduct within the firm.
The allegations
In December 2024, the FCA charged John Dance with nine criminal offences, including fraud by abuse of position and money laundering. These charges stem from accusations that between 2014 and 2023, Dance misappropriated over £64 million from client accounts of WealthTek and Vertus. The FCA alleges that these funds were diverted to personal accounts controlled by Dance and were used to fund a lavish lifestyle, including investments in horseracing, property acquisitions, and a nightclub.
Key allegations include:
- The transfer of £723,000 to purchase six racehorses, including Bravemansgame in 2019.
- Payments amounting to £806,500 in 2014 and £3.9 million in 2020 to acquire residential and commercial properties.
- False representations regarding WealthTek’s regulatory permissions to continue the alleged fraudulent activities.
WealthTek obtained direct FCA authorisation in 2020, but before that, it operated as a trading name and an appointed representative (AR) of Sapia Partners LLP. This AR model allowed WealthTek to perform regulated activities under the supervision of Sapia. However, the FCA alleges that Dance abused his position for personal financial gain, fabricating documents and misleading clients.
Latest developments
On 24 February 2025, John Dance appeared at Southwark Crown Court for a plea and trial preparation hearing, where he pleaded not guilty to three counts of fraud by abuse of position and three counts of fraud by false representation. The court has now set a trial date for September 2027.
Additionally, civil proceedings initiated by the FCA in April 2023 remain paused until the conclusion of the criminal case or further court order.
Despite the serious nature of the allegations, the FCA has assured affected clients that WealthTek’s special administration is ongoing. Approximately 84% of impacted customers are expected to receive full compensation.
Lessons for regulated firms
This case underscores critical compliance lessons for financial firms, particularly those operating under the appointed representative model. The FCA has increased scrutiny on ARs to ensure that principal firms are actively overseeing their representatives. The Dance case highlights the importance of:
- robust governance: Firms must have strong oversight mechanisms to detect and prevent misconduct.
- enhanced due diligence: When firms operate under an AR structure, ensuring proper checks on business partners and their financial dealings is crucial.
- regular compliance audits: Proactive audits help in identifying gaps before they escalate into major regulatory breaches.
- client asset protection: Ensuring that client funds are safeguarded through proper controls and oversight is essential for maintaining trust and regulatory compliance.
How Neopay can help
At Neopay, we specialise in compliance solutions that help firms navigate regulatory complexities and prevent financial misconduct. Our services include:
- compliance audits: We provide in-depth compliance reviews to identify potential risks before they become regulatory issues.
- governance framework development: We assist firms in strengthening their governance structures to prevent abuse of position and ensure regulatory alignment.
- appointed representative oversight: For principal firms, we help design and implement effective monitoring frameworks to ensure ARs operate within FCA guidelines.
- regulatory training: We offer training solutions to help firms and individuals understand their compliance responsibilities and stay ahead of regulatory changes.
The FCA’s case against John Dance serves as a stark reminder of the consequences of regulatory failures. Firms must remain vigilant in their compliance efforts to protect both their clients and their reputations. If your business needs guidance on ensuring compliance and avoiding regulatory pitfalls, Neopay is here to help.
Contact us today to learn more about our compliance solutions and how we can support your firm in reviewing, maintaining or enhancing your financial crime framework.
