Growing burden of regulation could put small firms at risk
Friday 5th March 2010, 2:30PM GMT.
THE demands of yet more regulation across the financial services industry has been questioned by a leading advocate.
Collas Day partner Sean Cheong (pictured), a specialist in financial services and regulatory work, said 2010 had already seen the implementation of the Licensees (Conduct of Business) Rules, ongoing consultation on expansion of the anti-money laundering legislation and on the draft Licensees (Capital Adequacy) Rules 2010, which seek, among other things, to introduce a liquidity requirement for licensees.
It has also seen the consultation period in relation to the Guernsey Financial Services Commission’s code of corporate governance for the island’s finance sector come to a close.
Just last week strong opposition emerged at an Institute of Directors seminar against the implementation of a new code, with a set of guidelines a preferred option by those industry members in the room, who included Guernsey International Business Association chairman Paul Meader.
Advocate Cheong believes regulation clearly has a role to play but the line between effective regulation, and regulation that stifles businesses, was increasingly blurred.
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Shame the GFSC aren’t up to introducing meaningful prudential/capital adequacy for all those securitisation vehicles of the shadow banking industry that we did so well over here. We might then not have helped to facilitate so much damage to the worldwide economy and the near meltdown of the banking industry.
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Indeed, Tom Jones. And it’s a shame that people who work in the industry don’t show more contrition. A gross failure.
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Why is most business keen to operate out of Guernsey?
Because it is a well regulated jurisdiction that tries to keep abreast of developments in international standards and requirements.
Advocate Cheong says that regulation has a part to play. It is a bit more than that.
Guernsey is respected for it’s international standard regulation. If people don’t like the regulations in Guernsey then they are probably not the people we want in Guernsey.
The Finance Industry would soon be complaining if Guernsey had poor FATF or IMF ratings and they could not attract legitimate risk averse business to the isalnd.
Those in the industry who want to attract riskier business should move to where there is less regulation. Guernsey has a reputation to uphold.
I bet they won’t be complaining if the current IMF assessment scores Guernsey higher than Jersey, IoM or Bermuda. In fact i would bet good money that if that happens then these finacial services businesses and Advocate Cheong will be using it as a means to sell business in Guernsey.
the world ischnaging especially after the financial crisis. Get used to it.
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