Louvre Fund Services Limited, Kevin Gilligan, Charles Peter Gervais Tracy, Derek Paul Baudains, Julian Dai Lane (2020-02-17)

Summary

This is a public enforcement statement issued by the Guernsey Financial Services Commission (GFSC) against Louvre Fund Services Limited, a licensed fund administrator and fiduciary, and four of its directors (Kevin Gilligan, Charles Peter Gervais Tracy, Derek Paul Baudains and Julian Dai Lane). It follows a GFSC investigation (commenced 2017, with Oben Regulatory Limited appointed as inspectors) into failures in fund administration, conflicts of interest, customer due diligence, monitoring, record-keeping and AML/CFT controls between roughly 2010 and 2017.

• Financial penalties: £77,000 imposed on the Licensee, £52,500 on Mr Gilligan, £31,500 on Mr Tracy, £28,000 on Mr Baudains and £14,000 on Mr Lane under section 11D of the Financial Services Commission Law.
• Director prohibitions: Mr Gilligan is prohibited from acting as a director, controller, partner or manager of a regulated entity under any Regulatory Law for 6 years and 2 months from 17 February 2020; Mr Tracy is prohibited for 3 years and 6 months from the same date.
• Exemption disapplied: The section 3(1)(g) Fiduciaries Law exemption is disapplied for Mr Gilligan and Mr Tracy for the same 6 year 2 month and 3 year 6 month periods respectively.
• Findings of failure: The Licensee and Directors were found to have failed to administer schemes in line with governing documents, manage conflicts of interest, obtain adequate customer due diligence and enhanced due diligence, monitor business relationships, keep proper books and records, and maintain effective AML/CFT policies and controls.
• Mitigation recognised: The Commission noted the Licensee's self-initiated remediation programme (completed 2019, independently verified), full cooperation, and early settlement, which reduced the penalties and prohibition periods imposed.

The statement is a case-specific enforcement outcome rather than a new rule; it does not create ongoing obligations for other licensees, but illustrates the Commission's expectations under the RCIS Rules, COB Rules, Code of Corporate Governance, CSP Code and the AML/CFT Regulations and Handbook for fund administrators and fiduciary licensees generally.

Key obligations

• Mr Gilligan must not perform the functions of director, controller, partner or manager of a regulated entity under any Regulatory Law for 6 years and 2 months from 17 February 2020
• Mr Tracy must not perform the functions of director, controller, partner or manager of a regulated entity under any Regulatory Law for 3 years and 6 months from 17 February 2020
• Louvre Fund Services Limited, Mr Gilligan, Mr Tracy, Mr Baudains and Mr Lane must pay the financial penalties of £77,000, £52,500, £31,500, £28,000 and £14,000 respectively imposed under section 11D of the Financial Services Commission Law
• The section 3(1)(g) Fiduciaries Law exemption is disapplied to Mr Gilligan and Mr Tracy for their respective prohibition periods

Applies to

fund administrators, fiduciary licensees, investment licensees (Category 1 and Category 2 controlled investments), directors of regulated entities

Deadlines

• 6 years and 2 months from 17 February 2020: Duration of Mr Gilligan's prohibition from acting as director, controller, partner or manager of a regulated entity, and disapplication of the section 3(1)(g) Fiduciaries Law exemption for him.
• 3 years and 6 months from 17 February 2020: Duration of Mr Tracy's prohibition from acting as director, controller, partner or manager of a regulated entity, and disapplication of the section 3(1)(g) Fiduciaries Law exemption for him.