Provident Trustees (Guernsey) Limited (2016-01-25)

Summary

This is a public statement issued by the Guernsey Financial Services Commission (GFSC) announcing enforcement action against Provident Trustees (Guernsey) Limited and three of its directors for failures in anti-money laundering and countering terrorist financing (AML/CFT) systems and controls. The Commission imposed financial penalties on the licensee and its directors and made the statement public under its statutory powers. It is a record of a specific past enforcement decision rather than a document creating new ongoing rules for the wider industry.

• Penalties imposed: £42,000 on Provident Trustees (Guernsey) Limited; £18,375 on Mr William Hunter; £10,500 each on Mr Andrew King and Mrs Lesley Chapman, all under Section 11D of the Financial Services Commission Law.
• Grounds for action: Failure to meet minimum licensing criteria under Schedule 1 of the Fiduciaries Law due to inadequate policies, procedures and controls to mitigate financial crime risk, and directors' lack of probity, competence and sound judgement.
• Key failings identified: Inadequate customer due diligence (including on powers of attorney holders and trust beneficiaries), ineffective enhanced due diligence on high risk clients (PEPs, high profile individuals, sensitive jurisdictions), failure to apply GFSC Instructions on existing customers, poor ongoing monitoring and transaction scrutiny, and undocumented consideration of suspicious activity reporting.
• Governance failure: Directors found not to have fulfilled corporate governance obligations under Regulation 15 of the Criminal Justice (Proceeds of Crime) (Financial Services Businesses) Regulations, 2007, having failed to remediate similar issues identified in earlier 2009 and 2011 visits.
• Mitigation: A discount was applied to the penalties because the directors cooperated fully and agreed to settle at an early stage.
• Clarification: The enforcement action does not relate to services provided by the separate entity Provident Financial Services Limited, which was visited but not referred to the Enforcement Division.

Applies to

fiduciary licensees, trust companies, company directors of licensed fiduciary businesses