Whistleblower Awarded £560,000 After Informing FCA about Firm Seeking UK Visa for a Chinese Spy

In Mr Bharat Bhagani v Goldenway Global Investments (UK) Ltd, the compliance director of a brokerage firm raised concerns about his employer’s activities to the Financial Conduct Authority (FCA). The Employment Tribunal ruled that this was the principal reason for his subsequent unfair dismissal. We discuss the case further, including the tribunal’s judgment, in the below article.

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The Facts in Mr Bharat Bhagani v Goldenway Global Investments (UK) Ltd

Claimant Raises Concerns about Acquiring UK Visa for a Chinese Spy

Goldenway Global Investments (the respondent) is a foreign exchange brokerage firm. It is wholly owned and controlled by Goldenway Precious Metals Limited (GPM), a company registered in Hong Kong. Much like for all UK-based brokerage firms, the Financial Conduct Authority regulates the respondent. Therefore, it is required to comply with various legal and regulatory requirements, including those specified in the FCA Handbook.

Bharat Bhagani (the claimant) was employed as the respondent’s compliance director. His functions included those of executive director, compliance oversight, and money laundering reporting officer (MLRO). The claimant was responsible for ensuring that the respondent complied with its obligations in the FCA Handbook. He was also obliged by the Financial Conduct Authority to report any instances of suspected money laundering.

From December 2020, a number of incidents took place which caused the claimant concern in his role as compliance director. One such was the attempted movement of a multi-million-pound sum of money by GPM. The claimant felt that this was an illegal payment and froze the sum, rejecting subsequent requests to unfreeze it.

In June 2022, GPM requested that the claimant sign a letter for the appointment of a new employee. The claimant raised concerns regarding this appointment, given that he had previously been questioned about an espionage agent from Beijing, who was later deported.

On that occasion, he alleges, GPM had helped with gaining a UK Visa for a Chinese spy.

Claimant Reports Issues to the Financial Conduct Authority

Later in June 2022, GPM attempted to appoint two new company directors to the respondent. They were both Hong Kong residents and had not been approved by the FCA. The claimant therefore refused to assist with the appointments, pointing out the regulatory issues, and stated that he would be willing to assist following the two prospective directors receiving FCA approval.

In his correspondence with GPM, the claimant explained he was “in discussions” with the FCA. He also advised that GPM should seek legal advice with respect to the appointment of the new directors.

However, on 20 July 2022, the respondent (via GPM) passed several resolutions, giving them the power to appoint and remove directors. The respondent informed the claimant that he had been removed as a director but that he should continue to fulfil his compliance responsibilities.

Shortly after, on 21 July 2022, the claimant contacted the Financial Conduct Authority about his concerns regarding the respondent’s and GPM’s activities. He referenced the espionage agent from Beijing and GPM’s attempt at gaining a UK visa for a Chinese spy. He also disclosed the illegal payment which he had frozen and the appointment of directors which had not been FCA approved.

Claimant Dismissed After Disclosing GPM’s Role in Acquiring a UK Visa for a Chinese Spy

The claimant received a letter from the respondent, stating that he had been dismissed for gross misconduct, on 26 July 2022. This gross misconduct apparently comprised the claimant failing to cooperate with the two new directors and “act[ing] to obstruct [their] ability to carry out effectively the day-to-day operations of the company.” The dismissal was to take effect immediately.

The respondent was later contacted by the Financial Conduct Authority in August 2022, raising concerns about the respondent’s activities. These concerns included the matters reported by the claimant and the claimant’s removal as the respondent’s sole UK-based director.

The claimant brought a number of claims against the respondent in the Employment Tribunal. These included unfair dismissal, breach of contract for failing to make payments in lieu of notice, and failure to pay accrued untaken annual leave.

The Employment Tribunal’s Judgment in Bharat Bhagani v Goldenway Global Investments (UK) Ltd

Bharat Bhagani’s claim was heard at the London Central Employment Tribunal by Employment Judge Emery.

Under the Employment Rights Act 1996, a person will have been unfairly dismissed if the principal reason for the dismissal was that they made a protected disclosure. The tribunal found that the claimant had made protected disclosures when he contacted the Financial Conduct Authority about his concerns. These concerns included the issue of the Chinese agent from Beijing and GPM trying to acquire a UK visa for a Chinese spy, among others

The tribunal held that the claimant contacting the FCA was the principal reason for the claimant’s dismissal, not gross misconduct. The respondent realised that the claimant was “in discussions” with the FCA and knew what those discussions were likely to have comprised. As such, the tribunal held, that the respondent had unfairly dismissed the claimant.

Employment Judge Emery stated that: “in making it clear [the claimant] had complained to the FCA, we conclude that [he] was seen as a threat and no longer an asset, that had he remained in post and continued to make these disclosures to the FCA he would have caused the [company] significant regulatory difficulties.”

The claimant’s claims for failure to make payments in lieu of notice and accrued untaken leave were also upheld by the tribunal. He was awarded compensation of £564,672.

If you believe that you have been unfairly dismissed, the expert employment lawyers at Redmans Solicitors can advise you. Contact our friendly, professional team today to arrange a free, initial consultation, and we can assess your eligibility to bring a claim and explain the legal process.

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