Chamberlain Heritage Services Limited, Mrs Deborah Anne Ellis (2023-08-24)

Summary

This is a public statement by the Guernsey Financial Services Commission (GFSC) detailing enforcement action taken against Mrs Deborah Anne Ellis, a former director, Compliance Officer and Deputy Money Laundering Reporting Officer of Chamberlain Heritage Services Limited (CHSL), a licensed fiduciary business. It sets out the findings, sanctions and reasoning behind the Commission's decision, originally made on 20 August 2020 but publication delayed pending appeal.

Sanctions imposed

• Financial penalty: A financial penalty of £14,000 was imposed on Mrs Ellis under section 11D of the Financial Services Commission Law.
• Prohibition order: Mrs Ellis was prohibited from holding the position of director, controller, partner or manager for a period of 1 year and 5 months under provisions of the Fiduciaries Law, POI Law, Insurance Business Law, IMII Law and Banking Law.
• Exemption disapplied: The exemption under section 3(1)(g) of the Fiduciaries Law was disapplied in respect of Mrs Ellis for the same 1 year and 5 month period.
• Public statement: A public statement was issued under section 11C of the Financial Services Commission Law, publication of which was delayed to allow completion of the statutory appeal process.

Findings against Mrs Ellis

• Due diligence failures: Failed to obtain adequate enhanced due diligence and ongoing monitoring for a high-risk client, contrary to Regulations 5 and 11 of the Criminal Justice (Proceeds of Crime) Regulations.
• Beneficiary interests: Did not always act in the best interests of trust beneficiaries, including charging opaque and unexplained closure fees (approximately £287,000 for one family's trusts and £60,000 for another client), contrary to Principle 4 of the TSP Code.
• Client agreements: Failed to ensure signed client agreements were held for certain clients, contrary to Principle 5 of the CSP Code.
• Corporate separateness: Failed to treat CHSL as a separate legal entity from its shareholders, including countersigning payments that diverted the majority of closure fee income directly to the majority shareholder without proper accounting, contrary to Principle 3 of the Directors Code.

The Commission found these contraventions serious due to detrimental effects on clients, but not deliberate or malicious, and applied a discount to the penalty and prohibitions in recognition of Mrs Ellis's cooperation and early settlement.

Applies to

fiduciary licensees, trust service providers, corporate service providers, company directors, individuals holding director, controller, partner or manager positions