Our approach to enforcement

Summary

This guidance note sets out how the JFSC approaches enforcement of regulatory requirements against firms and individuals. It explains the guiding principles and objectives behind enforcement action, how matters are referred to and investigated by the Enforcement division, the statutory investigatory powers available, the decision-making process for sanctions, and the range of sanctions the JFSC may impose.

• Referrals and investigations: Suspected breaches are first addressed through remediation with the supervisor; suspected serious misconduct may be referred to the Enforcement division, which decides whether to investigate based on impact on the JFSC's guiding principles.
• Investigatory powers: The JFSC can compel production of documents or information, compel individuals to attend and answer questions, require a firm to appoint (and pay for) a professional to produce a report, and direct firms or individuals to take or not take specified actions such as preserving records.
• Decision-making and appeal: Where a regulatory sanction is contemplated, the matter proceeds through the JFSC's published decision-making process (unless settlement discussions are underway); firms/individuals have a statutory right of appeal to the Royal Court of Jersey.
• Regulatory settlement agreements: A voluntary process available only where the firm or individual acknowledges misconduct; concludes with acceptance of a specified sanction, per the JFSC's published settlement policy.
• Available sanctions: Public censure statements, civil financial penalties (calculated using a published methodology), restricting or preventing individuals from working in a supervised sector, and revocation of a firm's licence; penalties, restrictions and revocations are accompanied by a public statement of reasons.
• Cross-border and criminal cooperation: The JFSC may refer suspected criminal conduct to Jersey's criminal authorities and assists other agencies/regulators, including by compulsorily obtaining and disclosing information for cross-border investigations.
• Deferred prosecution agreements: Firms engaging with the Attorney General on a DPA must still consider their obligations under the relevant Codes to deal with the JFSC openly and co-operatively; the JFSC will only take enforcement action following its own investigation, not solely on the basis of a DPA or statement of facts.

This is guidance rather than a rule change and does not itself alter licensing or filing requirements, but it clarifies the powers and process firms and individuals may face once under investigation.

Key obligations

• A firm or individual compelled by the JFSC must produce specified documents or information required for an investigation
• An individual compelled by the JFSC must attend before investigating officers at a specified time and place to answer questions
• A firm directed to appoint a professional (accountant, lawyer or regulatory consultant) to produce a report must do so at its own cost
• A firm or individual directed to take or refrain from specified actions (e.g. preserving records) during an investigation must comply
• A firm engaging with the Attorney General on a deferred prosecution agreement must continue to deal with the JFSC in an open and co-operative manner under the relevant Codes
• A firm or individual who wishes to challenge an imposed regulatory sanction must exercise the statutory right of appeal to the Royal Court of Jersey

Applies to

firms, individuals subject to JFSC regulatory requirements