On 16 April 2026, the Financial Conduct Authority (“FCA”) issued a Decision Notice imposing a £99,600 penalty on Carlos Ricardo Fuenmayor, CEO of BancTrust Investment Bank Ltd (“BancTrust”), for breaches of the FCA’s Senior Manager Conduct Rules.
The case, which has been referred by Mr Fuenmayor to the Upper Tribunal, is a significant addition to the growing body of regulatory enforcement against senior managers for failures to disclose material information to UK regulators.
This article examines the Fuenmayor decision in detail, explores its parallels with recent regulatory actions, and offers practical guidance for senior managers and those advising them.
Background and Core Facts
1. Matters the FCA considered were required to be disclosed to it
Carlos Ricardo Fuenmayor has been CEO and a senior manager of BancTrust, a UK-authorised firm, since 2018. He has held various controlled and senior management functions since 2012. The FCA’s investigation focused on a period from December 2017 to January 2023 (the “Relevant Period”), during which three key events occurred:
- FINRA Investigation: December 2017. Mr Fuenmayor became the subject of a US Financial Industry Regulatory Authority (“FINRA”) investigation in December 2017. A letter he received from FINRA at this time indicated that FINRA had made a preliminary determination to recommend disciplinary action against him for potential violations of the NASD and FINRA Rules. This receipt of this letter marks the start of the Relevant Period.
- FINRA Sanction: June 2019. FINRA issues a Letter of Acceptance, Waiver and Consent (“AWC”) to Mr Fuenmayor, imposing a 15-month suspension and a $20,000 penalty in June of 2019.
- Venezuelan Regulatory Action: November 2019. The Venezuelan National Financial Intelligence Unit (“UNIF”) froze Mr Fuenmayor’s local currency bank accounts, as well as those of his Venezuelan companies and their directors.
2. Opportunities the FCA considered existed to disclose
May 2018
- BancTrust submits the first application to the FCA for Mr Fuenmayor to hold additional controlled functions (CF10, Compliance Oversight).
- Application is reviewed by Mr Fuenmayor but does not disclose the FINRA investigation.
August 2018
- BancTrust submits a second application to the FCA for Mr Fuenmayor to hold further controlled functions (CF1, Director; CF3, Chief Executive; CF11, MLRO).
- Application is reviewed and submitted by Mr Fuenmayor but again does not disclose the FINRA investigation.
October 2019
- BancTrust submits a Variation of Permissions (VOP) application to the FCA, seeking additional permissions.
- Application is reviewed by compliance consultants and Mr Fuenmayor but does not disclose the FINRA sanction or investigation.
October 2019 – March 2020
- FCA approves the VOP application. BancTrust does not update the application to disclose the UNIF action.
December 2020
- Compliance consultants conduct a Compliance Assurance Review at BancTrust.
- Mr Fuenmayor does not disclose the FINRA sanction to the consultants.
3. When was disclosure made to the FCA and why?
August 2021
- BancTrust begins receiving information requests from counterparties who have become aware of the FINRA sanction.
December 2021
- Mr Fuenmayor, after discussions with BancTrust’s compliance staff, submits a Form D Disclosure Notification to the FCA, disclosing the FINRA sanction but not the UNIF action.
January 2023
- FCA becomes aware, via a Spanish-language press article, that UNIF had blocked Mr Fuenmayor’s accounts and those of his companies and directors.
- FCA contacts BancTrust seeking clarification of the press article.
- BancTrust, with input from Mr Fuenmayor, responds to the FCA but does not mention the freezing of the accounts.
The FCA’s findings
The FCA concluded that Mr Fuenmayor had breached both APER Statement of Principle 4 (“APER 4”) and Senior Manager Conduct Rule 4 (“SMCR 4”), which require approved persons and senior managers to deal with the FCA in an open and cooperative way and to disclose appropriately any information of which the FCA would reasonably expect notice.
The FCA found that:
- Mr Fuenmayor negligently failed to disclose the FINRA investigation and sanction to the FCA, both in ongoing communications and in regulatory applications.
- He failed to disclose the UNIF action, despite being advised by BancTrust’s Head of Compliance that disclosure was required.
- When the FCA became aware of the UNIF action through a press article and sought clarification, Mr Fuenmayor helped draft a response that omitted the key fact that the accounts had been frozen.
- The FCA considered that Mr Fuenmayor’s conduct fell below the standards expected of a senior manager, particularly given his experience and the fact that he was the only person at BancTrust with full knowledge of the FINRA and UNIF matters.
Other cases on Senior Managers’ duties to disclose
The Fuenmayor case is not an outlier. It is part of a clear regulatory trend: the FCA and PRA are increasingly willing to take enforcement action against senior managers for failures to disclose material information, especially where overseas regulatory actions are involved.
Staley v FCA: Recklessness and the duty of candour
In Staley v FCA [2025] UKUT 00203 (TCC), the Upper Tribunal upheld a substantial financial penalty and prohibition order against James Staley, former CEO of Barclays, for recklessly approving a letter to the FCA that contained misleading statements about his relationship with Jeffrey Epstein. The Tribunal found that Mr Staley had acted without integrity and failed to be open and cooperative with the FCA, in breach of Individual Conduct Rules 1 and 3 and SMCR 4.
The Tribunal emphasised that the duty to disclose is not limited to direct questions from the regulator; it requires proactive, full, and frank disclosure of any information that the FCA would reasonably expect to receive.
Recklessness as to the truth of statements made to the FCA can amount to a lack of integrity, even in the absence of dishonesty.
The Tribunal was clear that the FCA cannot carry out its responsibilities effectively unless it can rely on regulated individuals and firms to bring relevant matters to its attention.
The Bank of Tokyo cases: international context and group dynamics
The Bank of Tokyo cases (PRA Final Notices against Akira Kamiya and Takami Onodera, 2018) involved senior executives at MUFG Securities EMEA plc, a UK subsidiary of a Japanese bank.
Both were penalised for failing to disclose to the PRA the potential implications of US regulatory action (by the New York Department of Financial Services) against their group.
The PRA found that both executives failed to disclose emerging risks to the UK regulator at an early stage, even though the outcome of the US proceedings was uncertain.
The duty to disclose applied regardless of whether the executives were directly responsible for regulatory reporting; it was sufficient that they were aware of information that might be material to the PRA’s assessment of fitness and propriety.
The PRA was explicit that group-level processes or instructions not to notify the UK regulator did not excuse the failure to disclose. Senior managers are expected to challenge group decisions and, if necessary, act contrary to group instructions to fulfil their UK regulatory obligations.
The PRA also rejected arguments that overseas confidentiality restrictions justified non-disclosure, emphasising that UK regulatory duties take precedence.
Kristo Käärmann: disclosure of personal (tax) matters
In a Final Notice dated 27 October 2024, the FCA found that Kristo Käärmann, CEO of Wise Assets UK Ltd and director of Wise Payments Limited, breached Senior Manager Conduct Rule 4 (SMCR 4).
The FCA imposed a penalty of £350,000 (after a 30% settlement discount).
The FCA concluded that Mr Käärmann failed, for over seven months, to notify the FCA of significant personal tax issue, specifically, a financial penalty imposed by HMRC for deliberate failure to notify and pay Capital Gains Tax on a substantial share disposal, and the risk (and eventuality) of being published on HMRC’s list of deliberate tax defaulters.
The FCA found that Mr Käärmann’s failure to disclose these matters was careless and fell below the standards expected of a senior manager, particularly given the potential reputational impact on both Wise Assets UK Ltd and Wise Payments Limited. The FCA only became aware of the tax issues after a media enquiry, not through voluntary notification.
The FCA’s recent guidance on SMCR 4
The FCA’s March 2026 Policy Statement (PS26/6) introduced further guidance on Senior Manager Conduct Rule 4 (SMCR 4), which is now reflected in the FCA Handbook. The new guidance clarifies and reinforces several points that are highly relevant to the Fuenmayor case and its predecessors:
- Ongoing duty: The duty to disclose is not a one-off obligation. It is ongoing and applies to any information of which the FCA would reasonably expect notice, including developments in ongoing investigations or proceedings.
- Objective test: The test is whether a reasonable person in the senior manager’s position would have realised the information was material to the FCA’s assessment of fitness and propriety or the firm’s regulatory status.
- Overseas matters: The guidance explicitly references overseas regulatory actions, investigations, and sanctions as matters that should be disclosed, even if the individual believes them to be politically motivated, unfair, or ultimately inconsequential.
- Proactive disclosure: The guidance makes clear that the duty to disclose is proactive. It is not sufficient to wait for a direct question from the FCA, nor to assume that the regulator will find out from other sources.
- Internal advice and group processes: The guidance reiterates that reliance on internal compliance advice or group processes does not absolve the individual of personal responsibility. If in doubt, the expectation is to disclose or seek clarification from the FCA.
This guidance is not new in substance, but it is now more explicit and leaves little room for ambiguity or excuses.
Practical Lessons for Senior Managers
The Fuenmayor case, and its predecessors, offer several practical lessons for senior managers and those advising them:
1. Err on the side of disclosure
If in doubt, disclose. The FCA expects full transparency, especially regarding overseas investigations and sanctions. The risk of over-disclosure is minimal compared to the consequences of failing to disclose.
2. Read and understand regulatory forms
Senior managers must personally ensure the accuracy and completeness of all submissions to the FCA. Do not rely solely on compliance or third-party consultants; review the forms and guidance yourself.
3. Seek advice and (where necessary) challenge internal advice
Where there is any uncertainty, seek independent regulatory advice and, if necessary, escalate concerns internally. Do not assume that group processes or instructions are sufficient.
4. Maintain records
Keep contemporaneous records of regulatory communications and decisions regarding disclosure. If you decide not to disclose, document your reasoning and the advice received.
5. Foster a culture of openness
Boards and senior management should reinforce the expectation of candour with regulators at all levels. Encourage staff to raise concerns and err on the side of transparency.
6. Consider the extraterritorial dimension of regulatory obligations
Do not assume that overseas regulatory actions are irrelevant to your UK regulatory obligations. The FCA expects to be informed of any action that could be material to its assessment of fitness and propriety, regardless of jurisdiction.
When the breaches alleged by the FCA first occurred, Mr Fuenmayor was based in the US. Nevertheless, his UK regulatory obligations as an Approved Person applied.
7. Be proactive
The duty to disclose is proactive and continuous and not limited to responding to direct questions from the regulator. Individual Senior Managers must inform the PRA at an early stage, not just after the matter has crystallised or become public.
Conclusion
The FCA’s action against Carlos Ricardo Fuenmayor is a clear signal that the regulator will hold senior managers to account for failures to disclose material information, regardless of jurisdiction or perceived relevance. The case is part of a broader trend, reflected in the Staley and Bank of Tokyo cases, towards greater individual accountability and a more proactive regulatory approach.
Senior managers should review their own practices and those of their firms to ensure that regulatory obligations are fully understood and met. The cost of non-compliance is high—not only in financial penalties, but in reputational damage and, potentially, prohibition from the industry.
The message from the FCA is unequivocal: candour, proactivity, and personal responsibility are the hallmarks of effective senior management in the UK financial services sector.
