Businessman jailed again for contempt of FSA court orders

Mr Rourke was arrested and brought before the High Court on 17 September 2002 to answer allegations that he had breached court orders made on 4 April 2001 and 19 October 2001. The court orders required him not to accept any deposits from members of the public, and to provide the FSA with information about his assets.

Only those authorised to do so by the FSA can accept deposits, as banks do, from members of the public. Mr Rourke has no such authorisation.

On 18 September Mr Justice Lawrence Collins ruled that Mr Rourke had breached the court orders by accepting deposits from members of the public and failing to inform the FSA of relevant assets. Passing sentence in the case, Mr Justice Lawrence Collins explained that Mr Rourkes previous contempt of court, coupled with his recent dealings with depositors, warranted the prison term of 120 days. The case demonstrates the serious view taken by the courts of breaches of orders granted for the protection of members of the public.

The FSA is continuing its investigation into Mr Rourkes activities.

As a general rule, consumers should always check with the FSA that any financial services firm they deal with is properly authorised before they hand over any money. You can check whether a firm is permitted to take deposits via the FSAs website, www.fsa.gov.uk, or by calling the FSAs Consumer Helpline on 0300 500 5000.

Notes for editors

1. The previous contempt of court case against John E Rourke is set out briefly in this FSA press release, issued on 24 October 2001.

2. The second contempt hearing was heard in the High Court by Mr Justice Lawrence Collins on 17 and 18 September 2002.

3. The FSA alleged in March 2001 that Mr Rourke had breached sections 3 and 35 of the Banking Act 1987 (the Act). Section 3 of the Act provides that no person shall in the United Kingdom accept a deposit in the course of carrying on a deposit taking business unless authorised to do so by the FSA or unless otherwise exempt under the Act. Any person who contravenes this section is guilty of a criminal offence. Section 35 creates the offence of fraudulent inducement to make a deposit where a person knowingly or recklessly makes a misleading, false or deceptive statement or conceals material facts to induce another person to make, or refrain from making, a deposit or to enter into an agreement for that purpose. Breach of section 35 is a criminal offence. The Banking Act has now been replaced by the Financial Services and Markets Act 2000, which came into effect on 1 December 2001 and carries similar provisions.

4. The FSA issued proceedings against Mr Rourke (trading as J E Rourke and Co) on 30 March 2001 at which time the court granted an order requiring him not to accept or repay any deposits. This order was extended on 4 April 2001 until trial or further order. At the hearing on 18 and 19 October 2001 the High Court also granted final orders against Mr Rourke preventing him: (i) from accepting further deposits in his own name, his trading name of J E Rourke & Co or otherwise, and (ii) making misleading statements which he knows to be misleading for the purpose of inducing any person to make a deposit.

5. Court orders are a vital tool for the FSA in protecting the public through enforcement action against unauthorised financial schemes. Breaches of court orders are therefore a very serious matter.

6. The FSA regulates the financial services industry and has four objectives under the Financial Services and Markets Act 2000: maintaining market confidence; promoting public understanding of the financial system; securing the appropriate degree of protection of consumers; and fighting financial crime.

7. The FSA aims to maintain efficient, orderly and clean financial markets and help retail consumers achieve a fair deal.