The Guernsey Financial Services Commission has fined a locally-based finance firm and two of its staff for systemic anti-money laundering failures which took place over ten years.

Utmost Worldwide Limited has been fined £1,960,000 – which the regulator said is the largest financial penalty it has issued since the Commission’s powers were updated in 2017, in response to recommendations made by MONEYVAL.

As well as the £1.9m fine being paid by the firm, its CEO Leon Steyn has been given a £35,000 fine. 

He was described as failing to consistently act with competence, soundness of judgement and diligence.

The firm’s Deputy Money Laundering Reporting Officer, James Watchorn was fined £10,000 and banned from holding similar regulated roles for 17-months.

The GFSC said “Mr Watchorn demonstrated views in relation to money laundering risks that did not accord with the standards the Commission believed appropriate for the specific nature of his role, particularly given the Licensee’s large volume of high-risk clients”.

GFSC said together they and the firm were responsible for several serious failures.

“The findings in this case were serious, systemic, and spanned a significant period – 2015 to 2025.”

It’s understood that all parties cooperated with the investigation, and settled early, wrote the GFSC in its published judgment.

The GFSC said the company failed to adequately assess financial crime risks linked to unregulated international brokers and high-risk jurisdictions.

Instead of regular reviews, the firm relied on “trigger events”, which left many of these high-risk accounts unmonitored for years.

Approximately 1,900 client files were identified as containing fraudulent due diligence documents in 2014. Ten years later 200 of these still remained unremediated said the GFSC.

The GFSC added that Mr Watchorn downplayed red flags, and Mr Steyn failed to ensure the adequate oversight and controls.

The financial watchdog has confirmed that the firm has since launched a remediation programme to re-rate all clients and move towards conducting a periodic review cycle.