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On 27 November 2023, the JFSC published an industry update informing SUPERVISED FIRMS that its first themed examination for 2024 would focus on

  • Politically exposed persons (PEPs):

The remaining two [x2] CROSS INDUSTRY* themes for the 2024 Supervision Examination Unit’s Thematic Examination Programme are:

  • CROSS INDUSTRY - Compliance Monitoring
  • CROSS INDUSTRY - Conflicts of Interest.

The sector-specific THEMATIC ASSESSMENT VISIT (TAV) themes will be:

  • Banking – fraud controls and response
  • Fund Services Business – custody and safekeeping
  • Trust Company Services Providers – enhanced due diligence
  • Investment Business – suitability of advice
  • Designated Non-Financial Services Businesses and Professions – AML/CFT/CPF staff training and awareness.
  • Non-Profit Organisations – diversion mitigation


  1. Compliance Monitoring
  • Compliance monitoring is a process which enables an entity’s senior management to demonstrate how it has implemented and maintained adequate and effective systems and controls (including policies and procedures).
  • It also tracks whether these systems and controls are being complied with and, where they are not, ensures that timely action can be taken to remedy any identified deficiencies.
  • The Supervision Examination Unit will review as part of this thematic examination.
    • Governance and oversight arrangements regarding compliance monitoring and the design and
    • Implementation of the compliance monitoring plan (CMP)
    • The testing performed as part of the CMP to
  • Assess the effectiveness of internal systems and controls (including policies and procedures) and
  • Whether entities can demonstrate they have met the statutory obligations and regulatory requirements in
        1. The Codes of Practice and
        2. The AML/CFT/CPF Handbook
  1. Conflicts of Interest
  • Principle two of the Code of Practice for each industry sector requires entities to implement adequate procedures to avoid conflicts of interest or keep adequate records of such conflicts and address them appropriately.
  • This may include:
    1. Disclosure to the customer
    2. The application of internal rules relating to confidentiality
    3. Declining to act where the risk is too high to proceed.

3. The Supervision Examination Unit will consider how.

  • Entities identify and record conflicts.
  • It will also examine the governance, oversight and effectiveness of entities’ systems and controls (including policies and procedures) concerning.
      1. Conflicts of interest and
      2. Staff training and
      3. Awareness levels.


Separate to the Supervision Examination Unit’s thematic examination programme, which is cross-sectoral, will be conducted by the relevant supervisory teams as detailed below:

Banking: fraud controls and response

  1. The TAV will assess the effectiveness of banks’ systems and controls to detect and prevent fraud, ensuring their control frameworks are fit for purpose.
  2. The focus of the TAV will include looking at whether the risk management framework has appropriate oversight and how management information is reported, actioned and escalated. It will also review whether there is clear, local, responsibility for implementing policies and procedures to counter the risk that the bank’s operations in Jersey might be used for Authenticated Push Payment and other payment frauds.
  3. Supervisors will consider the fraud reporting process for customers to understand how easy it is to report fraud, particularly for vulnerable customers. Supervisors will also review what action banks take to recover funds transferred once a fraud has been uncovered, and how any complaints in relation to fraud have been handled.

Fund Services Business: custody and safekeeping

  1. The JFSC have identified a concentration risk due to the restricted number of service providers for custody and safekeeping in the funds sector.
  2. The focus of the TAV will be to review firms that are licenced to hold or control customer assets (including digital assets), looking at the adequacy of the span of control obligations, the effectiveness of management information available to the board and senior management, including escalation reporting where failures to properly segregate and designate client money are identified.
  3. Supervisors will also consider the entities’ controls relating to fraud and misappropriation, compliance with the customer asset rules, and their approach to assets held off-balance sheet and accepting client funds onto their own balance sheets.

Trust Company Business: enhanced due diligence

  1. Supervised persons must apply enhanced due diligence (EDD) in certain circumstances, including where there is a higher risk of money laundering or financing terrorism, as set out in the Money Laundering (Jersey) Order 2008.
  2. The 2023 NRA Refresh highlighted areas for improvement to the application of EDD measures in the industry sector.
  3. The focus of the TAV will be the effectiveness of EDD measures and compliance with the relevant obligations. It will cover the periodic review process for customers with EDD measures applied and assess whether the EDD measures are appropriate to the risks identified and up to date. Supervisors will also review beneficial owner and controller information and information maintained to corroborate source of wealth/source of funds.

Investment Business: suitability of advice

  1. The TAV will assess whether firms have met their obligations to perform adequate due diligence to determine which products and services suit their customers’ needs.
  2. The focus of the TAV will be on whether the advice provided by the entity is appropriate in the circumstances and whether entities are treating their customers fairly. Supervisors will also consider whether investment services are delivered with due care and skill as well as the appropriateness and frequency of staff training.

Designated Non-Financial Services Businesses and Professions: AML/CFT/CPF staff training and awareness.

  1. Supervised persons must take appropriate measures to raise employee awareness of relevant AML/CFT/CPF policies, procedures and enactments and provide appropriate employee training.
  2. They must also establish and maintain procedures that monitor and evaluate the effectiveness of those policies and procedures and employees’ awareness and training.
  3. The TAV will look to establish if supervised persons can demonstrate the provision of adequate role-based AML/CFT/CPF training to its employees.
  4. Supervisors will focus on the content of the training as it relates to the obligations of the supervised person and, separately, its employees under the relevant enactments and the content of the training as it relates to employees’ awareness and understanding of the supervised person’s relevant policies and procedures.

Non-profit organisations (prescribed NPO population only): diversion mitigation

  1. Diversion occurs where transactions by a prescribed NPO (or Associate NPO) divert funds away from legitimately intended purposes to a terrorist, terrorist cell or terrorist organisation for them to benefit from, directly or indirectly.
  2. A prescribed NPO must:
  • Assess and mitigate the risk of being used to assist terrorism or the financing of terrorists.
  • Define and document its approach to diversion risk in a risk appetite statement.
  • Have internal systems and controls in place to mitigate diversion risks.

3.Prescribed NPOs have been subject to the Prescribed NPO Order for one year and will be expected to have familiarised themselves with the requirements.

4.The TAV will be designed to test the implementation and effectiveness of such measures.



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