Thematic Review of Unclaimed Client Money of Collective Investment Schemes (2023)

Summary

This is a Thematic Review report issued by the GFSC summarising a 2022-2023 review into how unclaimed and unallocated client money is handled across Guernsey's authorised and registered Collective Investment Schemes. It sets out the Commission's findings on the scale and causes of the issue and flags that the Commission intends to consult on new guidance or rules in future, rather than imposing new binding requirements itself.

• Scale of the issue: Unclaimed Money totalled about GBP 16.6 million across 38 of 968 regulated Schemes (3.93%) as at 31 December 2022, only 0.0057% of total industry NAV of GBP 291.7 billion; no material unallocated money issue was found.
• Who is affected: The issue is concentrated in older, open-ended Schemes (11.51% of open-ended Schemes affected versus 2.17% of closed-ended), mostly authorised before 2017, and driven mainly by outstanding CDD and lost contact with investors.
• Inconsistent practice: Designated Administrators and Scheme Boards handle Unclaimed Money inconsistently, and few Scheme constitutional documents contain clear provisions covering all Unclaimed Money scenarios.
• Current rules gap: Outside the Class B Rules (which require unclaimed distributions to be dealt with per principal documents or transferred to scheme property after six years) there is no specific Guernsey guidance or rules on Unclaimed Money.
• Proposed next steps: The Commission intends to issue a Consultation Paper seeking industry views on future guidance or rules, and proposes to update Form 228 (Surrender of Scheme Authorisation/Registration) to require disclosure of any Unclaimed Money and proposed handling on surrender.

The report itself does not create new binding obligations; it is a findings and recommendations document intended to inform a future consultation and possible rule changes. Designated Administrators, Scheme Boards and liquidators are encouraged to review their internal policies on Unclaimed Money and ensure constitutional documents contain clear provisions, but no specific compliance deadline is set.

Applies to

Collective Investment Schemes (authorised and registered), Designated Administrators, Scheme Boards, Liquidators of Collective Investment Schemes