Consultation Paper No.3 2022: Senior Management Functions

Summary

This is a JFSC consultation paper seeking industry feedback on a proposed notice that would define who counts as a 'senior management function' for the purposes of the JFSC's civil financial penalties regime. It follows the Financial Services Commission (Amendment No.8) (Jersey) Law 2022, which extended the JFSC's power to fine individuals culpable in significant and material AML/CFT contraventions by a registered person, in line with FATF Recommendation 35.

• Category 1: A person managing any aspect of a registered person's local AML/CFT compliance or risk function, sitting below board level but above key person level.
• Category 2: A person managing any aspect of a registered person's affairs (other than Category 1) whose performance may impact compliance with the Money Laundering Order or an AML/CFT Code of Practice, who is below board level and directly accountable to the board or a principal person.
• Category 3: A person carrying out a duty or responsibility that the Money Laundering Order or an AML/CFT Code of Practice requires to be performed by senior management.
• Category 4: The 'senior officer' appointed for a Jersey branch of an overseas incorporated bank under banking legislation.

The proposals would affect senior managers in both financial institutions and DNFBPs (such as casinos, estate agents, lawyers and accountants), regardless of whether they are resident in Jersey, since it is the function performed that determines scope, not location (Category 4 individuals are always outside Jersey). The JFSC also signals an intention to later seek a legislative amendment requiring 'no objection' confirmation (via the personal questionnaire regime) before a person can be appointed to a designated senior management function, except for Category 4 senior officers of banks who are already subject to JFSC approval under existing banking legislation. This is a consultation only; no obligations are yet in force, and a final notice will follow after feedback is considered.

Applies to

registered persons, financial institutions, DNFBPs (casinos, estate agents, lawyers, accountants, high value dealers), banks (Jersey branches of overseas incorporated banks), senior managers, compliance officers, MLROs and deputy MLROs

Deadlines

• Friday 29 July 2022: Deadline for submitting consultation responses to the JFSC or to Jersey Finance Limited