Unlock Editor’s Digest for free
Roula Khalaf, editor-in-chief of the FT, selects her favorite stories in this weekly newsletter.
Prize-winning racehorses and a Newcastle nightclub were financed by John Dance using £64 million of client funds taken from his wealth management company, according to criminal charges brought against the WealthTek boss by British regulators.
THE Financial Conduct Authority said Wednesday it filed nine charges against Dance, including multiple counts of fraud and money laundering.
Dance allegedly used his position at WealthTek and his Vertus business “for his own personal gain,” withdrawing money from client accounts “to fund a lavish lifestyle and other business interests, including horse racing and nightclub,” the FCA said.
WealthTek, which also operated under the name Malloch Melville, was put under administration last year, after an application to the High Court by the FCA as it sought to protect customer funds.
The watchdog charge Dance, 50, converted or transferred criminal property by moving money from his clients’ funds to his personal and business bank accounts.
In one such move, he reportedly transferred £723,000 in 2019 to acquire six racehorses, including Bravemansgame, who won the King George VI Chase at Kempton Park in 2022 and was runner-up in the Cheltenham Gold Cup. ‘last year.
The FCA alleges that Dance withdrew money from customer accounts to fund purchases of residential and commercial properties, including transfers of £806,500 in 2014 and £3.9 million in 2020.
The regulator said it also charged Dance with three other offenses for making dishonest misrepresentations about WealthTek’s regulatory approvals to further his alleged fraud. The company had been regulated by the FCA since January 2020, prior to which it traded as an Appointed Representative of Sapia Partners.
“This is one of the most serious and significant frauds we have ever investigated,” said Therese Chambers, co-executive director of enforcement and market oversight at the FCA.
“WealthTek’s special administration continues and its clients have started to receive their assets and remuneration,” the FCA said. “Approximately 84 percent of those affected will be fully compensated.”
Acknowledging that it had been “a worrying time” for WealthTek investors, Chambers said: “We are pleased that clients will now have their assets returned. »
Dance, who is subject to a restraining order to preserve his assets for possible future forfeiture pending the outcome of a trial, has been released on bail and is scheduled to appear in Magistrate Court from North Tyneside on January 3.
Lawyers for Dance did not immediately provide comment.