The Guernsey Financial Services Commission published a public statement on its 24 June 2022 decision to impose a GBP 450,000 financial penalty on Artemis Trustees Limited, a licensed fiduciary company. The Commission found serious and systemic failings in the firm’s anti-money laundering and countering the financing of terrorism controls, governance and conduct, concluding that it failed to monitor and manage the financial crime risks associated with its customers and did not adhere to Guernsey’s corporate governance, trust service provider and conduct requirements. The findings covered multiple control weaknesses. Artemis failed to carry out effective ongoing monitoring of high-risk and politically exposed clients, missed or ignored red flags linked to adverse media, sanctions exposure and suspicious ownership changes, and in some cases facilitated restructuring and fund movements that obscured ownership or the origin of funds. It also failed to take reasonable measures to establish source of funds and source of wealth, kept large backlogs of overdue periodic reviews, did not properly understand customer ownership and control, missed earlier opportunities to make suspicious activity disclosures, and failed to ensure legacy client relationships were fully understood. Separate findings covered unmanaged conflicts of interest and weak internal controls, including staff and directors receiving valuable shares connected to a client relationship, accepting shares in lieu of fees, and lacking controls over cryptocurrency-related risks. The Commission also found the firm had not dealt with it in an open and cooperative manner by understating the scale of outstanding remedial actions. The statement notes mitigating steps taken after the 2018 on-site visit, including additional directors, an independent chief executive officer, a non-executive director, expanded compliance resources and third-party compliance and internal audit support.

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