Civil Financial Penalties on Natural Persons: Methodology for Determining the Amount

Summary

This JFSC policy document sets out the methodology the Jersey Financial Services Commission uses to calculate the amount of a civil financial penalty imposed on a natural person (a principal person, key person, or person performing a senior management function) for a significant and material contravention of the Money Laundering (Jersey) Order 2008 or a JFSC Code of Practice. It does not create new obligations for regulated firms but explains how the JFSC exercises its existing statutory penalty powers under the Financial Services Commission (Jersey) Law 1998 and the Financial Services Commission (Financial Penalties) (Jersey) Order 2015.

• Penalty bands: Four bands set maximum penalties for natural persons: Band 1 (failure to notify, up to £10,000), Band 2 (uncured contravention, up to £200,000), Band 2A (negligent contravention, up to £300,000) and Band 3 (intentional or reckless contravention, up to £400,000).
• Step 1 - seriousness: The JFSC scores impact on its three relevant Guiding Principles (risk of financial loss, reputational harm to Jersey, and countering financial crime) on a 1-5 scale, averages them, and applies a percentage (15% to 75%) of the maximum band penalty as the starting Step 1 figure.
• Steps 2-11: A structured sequence follows: adjust for aggravating/mitigating factors (net plus or minus up to 50%), add back any profit derived from the contravention, check consistency with other cases, cap the result at the statutory maximum, consider the person's and third parties' ability to pay, and finally apply any early-settlement discount (up to 50% at Stage 1, 25% at Stage 2, 5% at Stage 3 of the Decision-Making Process).
• Appeal right: A person penalised may appeal to the Royal Court under Article 21F of the Commission Law on the ground that the JFSC's decision on imposition or amount was unreasonable.
• 2025 update: The 12 February 2025 revision clarifies Step 3, confirming the JFSC may use a gross amount as a proxy for income/profit unless the person provides persuasive evidence supporting a different figure.

Appendix 2 lists non-exhaustive aggravating factors (e.g. poor compliance record, failure to act on becoming aware of a contravention, client losses) and mitigating factors (e.g. prompt self-reporting, full cooperation, swift remediation). Appendix 3 provides a worked example applying the methodology to a Band 2A case, illustrating a final discounted penalty after a Stage 1 settlement.

Key obligations

• A natural person subject to a civil financial penalty may appeal to the Royal Court under Article 21F of the Commission Law where they consider the JFSC's decision on imposition or amount was unreasonable.
• A natural person disputing the JFSC's use of a gross amount as a proxy for income under Step 3 must provide persuasive evidence to support use of a different amount.

Applies to

principal persons, key persons, persons performing senior management functions, registered persons