Given that the JFSC has stated that it is looking to build a track record of effective risk-based assessment ahead of Jersey’s next MoneyVal evaluation in 2021/2022, we would not be surprised to see further enforcement action in the upcoming 18 months.
So rather than being outliers we consider these two cases to be indicative of a new normal to be expected from the JFSC. In any event, regularly reviewing and testing your AML/CFT processes and policies is the best way for a regulated entity to ensure that it complies with its obligations and avoid such penalties. Given the amendments made to the Money Laundering Order 2008 over the last 12 months, now would be a sensible time for businesses to review their compliance measures.
The increased use of the civil financial penalty regime should not be taken lightly by regulated entities or their principals, especially since the JFSC also has the power to impose similar civil penalties on ‘principal persons’ of a ‘registered person’ (i.e., a regulated entity). However, the threshold for imposing a civil financial penalty on a principal person is high – there must be a significant and material contravention by a registered person and such contravention was (i) committed with the consent or connivance of, or is attributable to neglect on the part of a principal person or (ii) aided, abetted, counselled or procured by a principal person.
The offshore market represents a unique and evolving regulatory environment, and one that can be high profile if things go wrong. Appleby have a global network of experts on hand to advise clients who want to alleviate the burden of understanding each offshore jurisdiction’s regulatory frameworks and requirements.
If you have any concerns about your business’s AML/CFT policies and processes, or if you simply want to discuss how your business’ policies and procedures can be tested against the legal framework, we invite you to get in touch with one of our team of specialists.