FSA Annual Report 2016/17

25 / 66

ENFORCEMENT
Regulatory Enforcement Action
During the past calendar year the number of
active enforcement investigations has shown
a significant increase. The reasons for such
increase are necessarily subjective but may
well reflect ongoing economic pressures
within the financial services sector, as well as
ongoing enhancements to the Authority’s
supervisory practices.
The nature of the work, and the fact that
certain of the Authority’s powers are subject
to appeal, means that not all of the
enforcement action taken by the Authority is
in the public domain.
During the period the Authority conducted a
formal investigation into prima facie
contraventions of the AML/CFT Code. As a
result of this investigation, the Attorney
General’s Chambers issued a summons
against a particular regulated entity in
the Summary Court. That regulated entity
was subsequently convicted of several
counts involving contraventions of the
AML/CFT Code.
Company Law Measures
The Authority has power under the Island’s
company legislation to make application to the
High Court for the winding-up of companies in the
public interest. The Authority has wound-up the
following companies in the public interest over the
last year:
• The Eco Resources Fund PCC Plc which was
wound up on 16 March 2017
• New Earth Recycling and Renewables
(Infrastructure) Plc on 12 July 2016
• The Premier Investment Opportunities Fund
Protected Cell Company Plc on 12 July 2016
• The Eclipse Investment Fund Protected Cell
Company Plc on 12 July 2016
The Authority also has power, under CODA09, to
make application to the High Court for
disqualification of company officers whose conduct
renders them unfit to act in that capacity. During
the year the Authority issued such proceedings
against seven former officers of companies
associated with a former licenceholder, Louis Group
(IOM) Limited (in Liquidation). Two of the
defendants applied to have these proceedings
dismissed and a hearing to deal with this
application was held on 31 January 2017 and
1 February 2017. His Honour Deemster Doyle found
in favour of the Authority and the full judgment is
available to view
One of the seven defendants offered a voluntary
undertaking to the Authority and, in accordance
with relevant provisions under CODA09, that
undertaking was accepted by the Authority and
that individual is now disqualified from holding
corporate office for a period of five years.
During the year the Authority also determined that
it should pursue disqualification proceedings
against a person formerly employed by a regulated
entity and who had been convicted of offences of
dishonesty. Upon receipt of the Authority’s letter
before action that individual offered a voluntary
undertaking, in accordance with the relevant
provisions of CODA09, not to act as a company
director for a period of 15 years. The Authority
accepted the undertaking offered and as such that
individual is now disqualified from holding office
for the maximum possible term permitted under
CODA09.
The current list of disqualified directors can be
viewed .
Isle of Man Financial Services Authority Annual Report 2016/17 • 23