Judge overturns GFSC’s bans on finance directors

The Guernsey Financial Services Commission had imposed lengthy directorship bans and big fines on three senior figures at locally-owned trust company Artemis Trust in July 2022, but it contested them in court, and won.

But in a judgment which is likely to rock the fiduciary industry, in particular, on the eve of the island’s Moneyval review, Lt Bailiff Hazel Marshall struck down the bans and suggested that the fines should be reduced, before sending a warning shot to the commission about its approach.

‘The commission is understandably fervent in the performance of its functions of protecting the public interest, and protecting and enhancing the reputation of the Bailiwick as a financial centre,’ she said in the conclusion of the written judgment.

‘However, it seems to me that on occasions, the commission may overlook the fact that the reputation of the Bailiwick as a financial centre includes the reputation of the commission itself as a regulator.

‘In my judgment that reputation needs to be one of being “firm but fair” and the commission needs to keep in mind the danger that, in the interests of being perceived to be the former, it may overlook the latter.’

Advocate Anthony Williams, a partner at Appleby, who represented the three appellants, Ian Domaille, the majority shareholder in Artemis, and directors Ian Clarke and Margaret Hannis, added: ‘The judgment concluded that in relation to all three appellants there was no evidence that any of the matters of which they were accused had caused any harm to clients, beneficiaries, investors, creditors or member of public, nor to the reputation of the Bailiwick.’

The commission has issued a statement that said it was preparing to ask the Guernsey Court of Appeal to review legal aspects of the judgment.

‘Some of the reasoning and interpretation of the law contained in the judgment does not align with our understanding of our statutory duties and powers – as endorsed by the Royal Court and Guernsey Court of Appeal in prior judgments concerning appeals against our enforcement actions,’ it said.