The Guernsey Financial Services Commission has become aware of fake documents that have been issued in the Commission’s name and used in support of an advance fee fraud scheme.  The fake documents are titled “Financial Regulatory Due Diligence / Financial Provenance Clearance”.  The fraud scheme involves a fake law firm using the name Flaven Law Chambers and a fake bank using the name ApexKrest Bank, both of which falsely purport to be Guernsey based entities.  Steps are being taken to close the associated offending websites. 

Anyone who has dealt with the above-referenced entities is encouraged to contact the Commission’s Intelligence Team for further guidance.

The Guernsey Financial Services Commission has become aware of a fake news article purporting to be from the Guernsey Press that is circulating on social media which promotes investment opportunities for Guernsey residents with FortuixAgent. The article includes the Guernsey Financial Services Commission’s logo in a spurious account statement. The purpose of this notice is to advise that FortuixAgent is not licensed, authorised, or in any way regulated by the Commission to conduct any financial services business in or from within the Bailiwick of Guernsey.

The Commission recommends that people check the regulatory status of a company before making an investment and reminds residents to only deal with properly licensed businesses.

More information about investment scams and how to report them can be found on the investment scam page on the Commission’s website.  

The Guernsey Financial Services Commission is pleased to announce a new partnership in financial literacy with “EDUCFI”, the French National Financial Literacy Strategy operated by Banque de France, the French central bank, in order to provide unbiased, easy-to-read, quality material designed to help local people understand financial matters more easily. 

The partnership will see the Commission translate and adapt the Banque de France’s “Mot de l’Actu” or “A word from the news” and its “Eco en bref” or “The Economy at a glance” publications for Guernsey residents. Both publications are designed to provide consumers with trustworthy and free of charge information about the economy and financial terms. The Commission hopes that this knowledge and understanding will help people make more informed decisions about the types of investment and credit options available.

William Mason, Director General of the Guernsey Financial Services Commission, said: “We would like to thank the Banque de France for sharing these fantastic resources with us for the benefit of Guernsey residents, and the opportunities this offers for developing a deeper relationship between our two organisations.

“With the rapid rise of crypto-assets, advances in artificial intelligence and more sophisticated financial scams, having a basic understanding of financial terms and financial products is more important than ever. This is particularly pertinent in the digital age, where websites and ‘finfluencers’ are offering financial advice and promoting products, often mistakenly purporting to offer secure high returns.”

Marguerite Collignan de Durand, Financial Education Director in Banque de France, said: “As stated by Director General Mason, financial literacy is all the more important for the general public as the financial sector is getting increasingly sophisticated and digitalised. In this respect, central banks and supervisors in Europe should work hand in hand to promote a safer financial sector for citizens and investors. We hope that this agreement with the GFSC will be the first step towards a deeper cooperation between our two authorities.”

The Commission looks forward to launching these publications, which will be available on its website, in the near future.

L & A Finance Limited is Guernsey registered company. However, it has been noted that criminals have been using the company’s details in an attempt to commit fraud. The fraud scheme has included the setting up of a false website in the name of the firm. 

Anyone seeking to conduct business with L & A Finance Limited is encouraged to take steps to carefully ensure that they are dealing with the genuine firm. If in any doubt, please contact the Commission’s Intelligence Team for further guidance through the switchboard number of +44 1481 712706 or info@gfsc.gg.

The Commission is raising awareness of the use of non-bank payment service providers, such as electronic money institutions or EMIs, to ensure consumers know how to check adequate consumer protection is available.  

While online payments are generally made through bank accounts, the use of electronic money (e-money) stored in an online account, wallet, or pre-paid account, which may then be used for payments, is becoming increasingly popular.  

Only those payment service providers based within the Bailiwick, or specifically targeting Bailiwick residents, are required to be licensed by the Commission.  Individuals and businesses within the Bailiwick are able to use payment service providers based elsewhere, however the Commission does not have regulatory remit over those providers based outside the Bailiwick.

Individuals and businesses are encouraged to check whether the payment service provider is appropriately licensed in its home state and that adequate consumer protection is available. There is a risk that the provider, if not regulated by an equivalent body to the Commission, may not be acting in your best interests, and you may be left with limited options to take action against them.  In addition, should the provider go out of business, your money may be at risk. 

A list of all financial services businesses licensed and regulated by the Commission can be found on its website.  An up-to-date list of the Commission’s warnings can also be found on its website.

Today, the Commission has published a consultation paper proposing amendments to the rules for insurance intermediaries to include some additional disclosure requirements.

This affects the thirty-five insurance intermediaries operating in the Bailiwick which are licensed by the Commission.  The consultation sets out a proposal that would require the intermediaries to provide information to customers to help them make informed decisions about the insurance products they purchase.

The proposals represent good practice already in effect in industry and seek to formalise an existing requirement in the codes of conduct. The changes would also assist the Bailiwick to demonstrate its compliance with international standards.

Havelet Finance Limited is licensed by the Commission under the Lending, Credit and Finance (Bailiwick of Guernsey) Law, 2022.  However, it has been noted that criminals have been using the firm’s details in attempts to commit advance fee fraud.  The fraud scheme has included the setting up of false websites and pages on social media in the name of the firm. 

Anyone seeking to conduct business with Havelet Finance Limited is encouraged to take steps to ensure that they are dealing with the genuine firm.

The Commission has today published its feedback paper following the consultation on Lending, Credit & Finance issued on 21 July 2022, together with the final Lending, Credit & Finance Rules and Guidance and a s40 instrument giving notice of various exemptions from the requirement to hold a licence in respect of the carrying on of business regulated by the law.

The Lending, Credit and Finance (Bailiwick of Guernsey) Law, 2022 was approved by the States of Deliberation, the States of Alderney and the Chief Pleas of Sark in July 2022.  It will come into effect in full on 1 July 2023, by which time firms carrying on business regulated by the law will need to be licensed and to follow the rules set out by the Commission.  As well as regulating the provision of consumer credit, the law regulates Virtual Asset Service Providers and replaces The Registration of Non-Regulated Financial Services Businesses (Bailiwick of Guernsey) Law, 2008.

The Commission received an excellent response to the consultation, with more than 50 responses from across a range of stakeholders.  It has reviewed all of the responses received and made a number of changes to the draft Rules and Guidance which are designed to strike a balance between proportionate regulation and the protection of customers without unduly restricting the market and maintaining access to services from a variety of providers.  

The Commission will accept licence applications from 1 February 2023.  Forms are available on the website and persons requiring a licence are strongly encouraged to apply early.  Those applying before 31 March 2023 will benefit from a significant (50%) discount on the application fee.  The Commission is expecting a considerable number of new licence applications and is aiming to process all applications received by 31 March 2023 by 1 July 2023. 

In July 2022, the Lending, Credit and Finance (Bailiwick of Guernsey) Law, 2022 (the “Law”) was approved by the States of Guernsey, the States of Alderney and the Chief Pleas of Sark.  A Commencement Ordinance, passed last Friday, confirmed that the Law will come into effect in two stages.

Various provisions come into effect from 1 January 2023 which will allow the Commission to put in place its own Rules and guidance, and to invite applications for licensing.  The Law will then come into full effect from 1 July 2023.

The new Law covers several different areas:

• it introduces consumer protection and the regulation of credit provision and home finance across the Bailiwick for the first time; 
• it replaces the existing registration regime for non-regulated financial services businesses (“NRFSBs”), with licensing and regulation requirements; 
• it introduces the regulation of virtual asset service providers (“VASPs”) which brings the Bailiwick into line with international standards; and
• finally, it requires peer to peer and crowdfunding platforms in the Bailiwick to be licensed and regulated.

More information regarding the purpose and scope of the Law, and what it will mean for individuals and firms conducting activities covered by the Law, as well as consumers in the Bailiwick, can be found on our website.

The Commission is currently working through the responses to its Consultation Paper on its Rules and approach for regulating the sectors covered by the Law.  The Commission will issue a feedback paper, together with the finalised Rules and guidance, a list of exemptions from the requirement to apply for and hold a licence, and frequently asked questions.  This is intended to be published by the end of January 2023. 

Information on the application process will be published alongside the final Rules, and the licence application window will open at that time.  Early submissions will be encouraged with discounted application fees, to allow applications to be processed ahead of the commencement of the Law.  From 1 July 2023, firms without a licence may not operate until the appropriate licence is in place. 

Should you have any questions in the meantime, please contact the Lending, Credit and Finance team by email at LCF@gfsc.gg.