Two senior employees of Jersey trust company banned from working in finance

Two employees of Jersey trust company Lutea Holdings Limited have been barred from working in finance over “inadequate procedures” for detecting corruption, the Jersey Financial Services Commission said in two statements on 22 December last year.  

An on-site examination of Lutea Holdings Limited was undertaken in 2019 by the regulator amid concerns about the company's compliance with financial regulations.

It wasn't until December 2022 that the JFSC confirmed that it had settled with the business.

The latest two statements issued orders barring Nicola Marguerite Hodge and Andrew Mark Hicks from the industry. They will only be able to return if they get written permission from the JFSC.

In one of the statement, the JFSC said Hicks was a long-standing principal person of Lutea Holdings Limited and Lutea Trustees Limited (together, Lutea), a Jersey-regulated trust company business.

"In his role, Mr Hicks bore significant responsibility for ensuring the effective governance of Lutea, the identification and management of Lutea’s risks, and its compliance with Jersey’s Regulatory Framework.

"Following an investigation, the JFSC concluded that, between 1 January 2018 and 2 September 2021, Lutea failed to organise and control its affairs effectively for the proper performance of its business activities and operate adequate risk management systems. A number of Lutea’s failings in this regard were repeat findings from previous on-site examinations.

"As a long-standing principal person of Lutea, Hicks failed to ensure Lutea’s compliance with regulatory requirements over a protracted timeframe. In doing so, he failed to prioritise compliance matters, demonstrated a lack of awareness of regulatory requirements, and engendered an organisational culture within Lutea without due regard for compliance.

"Hicks’ failings caused or contributed to Lutea’s significant and material breaches of Jersey’s Regulatory Framework, as detailed in the Lutea public statement dated 21 December 2022[1], leaving Lutea vulnerable to significant money laundering/terrorist financing risks.

"The JFSC has concluded Mr Hicks lacks competency and poses a significant risk to the JFSC’s guiding principles and objectives of protecting and enhancing the reputation and integrity of Jersey in commercial and financial matters and the need to counter financial crime.

"The JFSC has, therefore, concluded it is necessary and proportionate to issue directions to Mr Hicks under Articles 23 of the FS(J)L and 23 of the Supervisory Bodies Law. Mr Hicks has been issued with equivalent directions under each of the other Regulatory Laws.

"The directions prevent Mr Hicks from performing any function for, engaging in any employment by, or holding any position in, any business regulated or supervised by the JFSC, without its prior written approval.

"The directions shall remain in force until such time Mr Hicks successfully applies to the JFSC, pursuant to Articles 23(6) of the FS(J)L and 23(6) of the Supervisory Bodies Law, for a variance or withdrawal of the directions.

"Mr Hicks will commit an offence, under Articles 23(15) of the FS(J)L and 23(15) of the of the Supervisory Bodies Law, in the event he fails to comply with the provisions of the directions.

"Any person who allows Mr Hicks to perform a function, engage in employment or hold a position knowing that such performance, engagement or holding is in contravention of the directions shall also commit an offence."

In the other statement, the regulator said Hodge was a long-standing principal person of Lutea Holdings Limited and Lutea Trustees Limited (together, Lutea), a Jersey-regulated trust company business.

"In 2019, she was appointed as Lutea’s Managing Director. In her role, Ms Hodge bore significant responsibility for ensuring the effective governance of Lutea, the identification and management of Lutea’s risks, and its compliance with Jersey’s regulatory framework.

"Following an investigation, the JFSC concluded that, between 1 January 2018 and 2 September 2021, Lutea failed to organise and control its affairs effectively for the proper performance of its business activities and operate adequate risk management systems. A number of Lutea’s failings in this regard were repeat findings from previous on-site examinations.

"As a long-standing principal person of Lutea, Ms Hodge failed to ensure Lutea’s compliance with regulatory requirements over a protracted timeframe. In doing so, she failed to prioritise compliance matters, demonstrated a lack of awareness of regulatory requirements, and engendered an organisational culture within Lutea without due regard for compliance.

"Ms Hodge’s failings caused or contributed to Lutea’s significant and material breaches of Jersey’s Regulatory Framework, as detailed in the Lutea public statement dated 21 December 2022[1], leaving Lutea vulnerable to significant money laundering/terrorist financing risks.

"The JFSC has concluded Ms Hodge lacks competency and poses a significant risk to the JFSC’s guiding principles and objectives of protecting and enhancing the reputation and integrity of Jersey in commercial and financial matters and the need to counter financial crime.

"The JFSC has, therefore, concluded it is necessary and proportionate to issue directions to Ms Hodge under Articles 23 of the FS(J)L and 23 of the Supervisory Bodies Law. Ms Hodge has been issued with equivalent directions under each of the other Regulatory Laws[2].

"The directions prevent Ms Hodge from performing any function for, engaging in any employment by, or holding any position in, any business regulated or supervised by the JFSC, without its prior written approval.

"The directions shall remain in force until such time as Ms Hodge successfully applies to the JFSC, pursuant to Article 23(6) of the FS(J)L and 23(6) of the Supervisory Bodies Law, for a variance or withdrawal of the directions.

"Ms Hodge will commit an offence, under Articles 23(15) of the FS(J)L and 23(15) of the of the Supervisory Bodies Law, in the event she fails to comply with the provisions of the directions.

" Any person who allows Ms Hodge to perform a function, engage in employment or hold a position knowing that such performance, engagement or holding is in contravention of the directions shall also commit an offence."