News

Directors accountability bites in Guernsey - it goes to show that not all directors are equal for failure

30/04/2021

Five years after Standard Chartered Trust (Guernsey) Limited (SCTG) ceased business (announced in July 2016), a single director is punished for AML failings.

I question whether it can be correct; no other director (as at posting these thoughts) has been punished.

Today's fine follows the 4th June 2020 announcement where the GFSC imposed a financial penalty of £140,000 under section 11D of the Financial Services Commission Law on the Licensee; https://www.comsuregroup.com/news/aml-fails-standard-chartered-trust-guernsey-limited-fined-140-000/

On reading the public statements, it seems to me that there was something more systemic than a single (scapegoat [sorry, but we need to be told more - to make this feeling go away]) director?

Consider what the GFSC said:

- Despite the numerous red flags already raised ... the Licensee then engaged in an unbalanced process to expedite the transfers to SCTS,'

- [It] was 'extremely concerned' the firm had not adequately considered the risk of clients potentially avoiding tax in Indonesia, and therefore, the funds it controlled represented the proceeds of crime

- It also showed a 'serious lack of prudence and professional skill' when considering employee concerns, it added.

Also, look at what MAS said

- The transfers occurred shortly before Guernsey implemented the Common Reporting Standards (CRS) for the Automatic Exchange of Financial Account       Information in Tax Matters. "The timing of the transfers raised questions of whether the clients were attempting to avoid their CRS reporting obligations," s

A StanChart spokesman said:

- "We regret that we fell short of our own standards in adequately mitigating the risks involving some clients who might have attempted to avoid reporting obligations under the Common Reporting Standard by transferring their trusteeships between December 2015 and January 2016.

Other sources

GUERNSEY