“Intentional and reckless” financial rulebreakers could be fined up to £400k under new rules

Wednesday 21 March 2018

A new law could see the JFSC allowed to impose fines of up to £400,000 on individuals in breach of conduct code, rather than on their company.

The proposed new law arises out of concerns that current practices only allow firms to be fined for employees’ wrongdoing, rather than the workers themselves.

That means that, should just a single employee be found to have breached a code of conduct that causes customers to lose money, a financial penalty on the  company could leave them without enough money to compensate clients.

“Any money available would be better applied to compensating those who have lost money rather than paying a civil financial penalty,” the draft law, which was proposed by the Chief Minister last week, states.

If approved by the States Assembly, the change would bring Jersey in line with international practice, as well as serving as a deterrent for bad behaviour:

“The Government is of the view that behavioural change is more likely to be achieved when principal persons know that, potentially, they will bear a financial penalty personally for poor conduct.”

The Civil Penalities regime, under which the JFSC is able to fine firms, was introduced in 2014, but it was always expected that such a change would be made to allow individuals to be fined too. 

Under the proposed law, they could be eligible to pay up to £400,000 – an amount reserved for a ‘Band 3’ fine for “intentional and reckless” rule-breaking.

The suggested legislative change aims to compliment another put forward by the Chief Minister – the addition of a new band reserved for “negligent” contraventions.

The proposals will be debated after the General Election by the new States Members on 26 June.