Laundering sentence helps GuernseyFinance
Thursday 20th January 2011, 2:29PM GMT.
ROGER TAYLOR’S 30-month sentence for money laundering will act as a deterrent to others, according to the chief executive of GuernseyFinance.
Peter Niven said that the jailing of Roger Taylor, 61, earlier this week sent out a clear message that Guernsey had a broad and dynamic finance industry able to attract good business – and had no need to welcome anything otherwise.
Mr Taylor was found guilty of nine separate charges during a 10-day trial during December. He was sentenced in the Royal Court on Tuesday in what was the first clear case of money laundering to be heard in Guernsey.
‘It will not be tolerated, as both the comments of Judge Russell Finch and the severity of his sentence clearly indicate,’ said Mr Niven (pictured).
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30 months is not that much of a deterrent for 9 offences. Has he be fined also? Would he have to serve the whole of the sentence or could he leave early.
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“DISCONNECT”
Too late for inclusion in the International Monetary Fund’s reports, Peter. The IMF said it is concerned about the way Guernsey implements its money-laundering rules, saying there is a “disconnect” between cases that are investigated and those eventually prosecuted. It said Guernsey needs to bolster rules to prosecute foreign money launderers and expand the list of “high-risk customers”. One prosecution doesn’t change things overnight.
The IMF said: “The modest number of cases involving money laundering by financial-sector participants, and the disconnect between the number of money-laundering cases investigated versus the number of cases prosecuted and eventually resulting in a conviction, calls into question the effective application”.
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Are we being led to believe that this is the only person prosecuted for money laundering ?
If so id say its a very poor effort on behalf of the gfsc and financial crime brigade.
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Let me get this straight the first clear case of money laundering to be heard in Guernsey. How long has the finance been here? And you want me to believe that nobody has ever tried laundering money here in all that time. Convenient how this one comes shortly after a lot of criticism about tax havens around the world and more pressure from the EU. They say it sends a clear message that Guernsey had a broad and dynamic finance industry able to attract good business – and had no need to welcome anything otherwise. It sounds more like an advert to me. Launder your money here if you do get caught we will give you 30 months but don’t worry with good behavior you will be out in 10. Best terms in Europe.
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Whatever happened to the ’14 years’ for aiding and abetting the processing of the proceeds of crime?
As M Flynn has highlighted the “disconnect” cannot be ignored. It is wilful negligence of duty to society. But it really is no surprise.
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Is it really surprising there’s not more money laundering cases?
Wealthy organised criminals aren’t stupid – they’re well organised, experienced and highly skilled at what they do. Compare that to your average trust administrator or bank client relationship officer – you can’t really expect a 20 year old straight from school with limited experience to out-smart them, can you? With all due respect they’re not in the same league.
Is it really that surprising who has the upper hand?
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Yes, Sir.
It’s a fatal flaw in the claim that such large and numerous movements of funds that are attracted by our legislative environment, our connection to the City and our connections with other secrecy jurisdictions, can be adequately monitored and so present the out-spurting of “clean” from all the usual suspects.
It’s plainly nonsense. Has anyone explained recently about how the ‘sophisticated’ structures and vehicles really work? In real life. Not in finance jargon.
Nifty.
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Arnald
I suppose the best honest response we can realistically expect is “we try our best but can’t totally guarantee.” In defence of the local industry though, I haven’t heard anyone with any standing claim the island is 100% clean, have you?
I would also imagine the same battle is going on in High Street banks all across the world, and not just in offshore jurisdictions. So whether it’s fair for the likes of the USA to single out the island is debatable.
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i am surprised by all the negativity in the above posts.
Prevention is better than cure.
Has anyone thought that this might actually be a credit to Guernsey and not just the tip of an iceberg as some of the above posts seem to be suggesting.
If you read the very recent IMF AML report following the IMF very detailed review of Guernsey you will see that the island received an excellent report and compares most favourably with all the offshore jurisdictions and much better than onshore jurisdictions. It is my understanding that the potential for money laundering within the City of London and in New York is much higher than in Guernsey.
The AML legislation introduced in Guernsey in 2007 and the diligent application of its requirements by local businesses means that the potential for money laundering through Guernsey is greatly reduced. In addition if you read the GFSC Annual reports you will see that they have had a rolling programme of “audits” of licensees to ensure that they are adhering to the AML legislation.
Rather than knocking Guernsey as a jurisdiction be proud of the fact that it is a jurisdiction which actively discourages money laundering and the financing of terrorism.
All financial services staff are required to receive AML training and I am sure that there are a lot of reports by Money laundering officers to the FIS and assistance which is given to other jurisdictions in their AML investigations which, through necessity, goes unreported to the general public.
Guernsey should be applauded for having identified a money launderer and for having successfully prosecuted.
it appears to me from reading the reports in the press that Mr Taylor was laudering money for a UK based ponzi scheme. In sentencing Justice Finch and the jurats would probably have taken into account the gentlemans age and the amounts involved which at $87,000 do not seem a great deal.
If you read the report in the GP on 19 january it suggests that the defence lawyer asked for leniency and just a community service order!
Michael Summers who ran the ponzi scheme in the UK got four years so two and a half for Mr Taylor seems about right.
From my experience Guernsey financial services businesses would rather turn away a potential client at the initial contact stage than take that client on and then become embroiled in problems if the business then transpires to be questionable. ” Not the sort of business we want in Guernsey” is often spouted.
Unfortuantely, reading between the lines, Mr Taylor was greedy and thwarted the laws and regulations in Guernsey by assisting a UK criminal in laundering his ill gotten gains.
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Yes, Sir, I’m sure there’re easier places to be deceitful, but several wrongs doesn’t make it any righter.
New business may be more carefully vetted. How much old business is there?
And the laundering aspect is only a part of the whole of de facto fraud.
The lack of available information on the unknown knowns, the obvious existence of known unknowns and the vast amount of unknown unknowns that cause the financial crashes, paint a far bleaker picture than Mr Taylor’s paltry attempts.
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@ Arnald
If somebody wants to launder money through any jurisdiction then I am sure they can find a way to do so but I am certain in Guernsey they will find it harder to do so than in some other jurisdictions and why come to a jurisdiction that actively fights money laundering when there are much easier places to go.
Of course if you can launder through Guernsey then that makes your money appear even cleaner.
Attempts are made but are often thwarted before the money arrives.
As to your point with regard to old business this was specifically covered by the 2007 AML legislation and , more recently by Instruction No6 from the GFSC. All retrospective AML reviews of existing clients had to be undertaken by 31 March 2010 and I am sure that in their reviews of licensees the GFSC is ensuring that retrospective AML due diligence has been actioned and completed.
You seem to paint a picture that there is a vast array of money launderers desparate to place there money in Guernsey. I am sure that some have slipped through the net but continuing vigilence by Guernsey’s financial service providers and the anti money laundering atmosphere in Guernsey should ensure these are few and far between.
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Simon
Agreed.
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Simon, there was certainly no negativity from me, more a healthy dose of realism.
I actually think a healthy dose of scepticism is healthy for the industry – it makes us more vigilant.
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Some interesting points have been raised here.
For a (full) money laundering conviction to be completed locally, as opposed to a technical breach of the local laws, there clearly needs to be a confirmed crime, i.e. a convicted criminal. In the Taylor case there was one in the form of Michael Summers. The local charge and conviction obviously then follows that.
Local financial services businesses file hundreds of STRs each year with the local FIS who deal with them accordingly. That information goes to overseas law enforcement agencies who process it accordingly. Whether or not that ultimately results in (a) a conviction of a criminal elsewhere, and (b) any charges being brought against any Guernsey finance employees is then largely out of Guernsey’s hands. The fact that Guernsey finance employees have filed the STRs in an effort to catch any money launderers often means that they are unlikely to face any charges locally themselves, unless of course they really have been complicit with their actions.
It results in a “prevention is better than cure” culture, and its realistic to anticipate that anybody charged locally is either an outright fool like Taylor, who was already in too deeply to get out and kept digging, or a “dinosaur” who is unwilling to accept that things have changed massively from 20-30 years ago. Thankfully most of the latter have either been closed down or driven away from Guernsey by not being granted licences to continue operating here.
It does mean that there is unlikely to be a high number of cases brought against Guernsey finance employees, and that the efforts of the industry to report and ultimately eliminate dodgy clients will result in far more people being caught all over the world. Would we rather have more local people charged here and less criminals caught all over the world?
Guernsey can only try and convict those who are charged. Finding large numbers of local people to charge is very unlikely. The pressure to bring charges against anybody here is very strong, but the Law Officers have to be satisfied that there is enough evidence to secure a conviction against the local finance employee. Bringing a string of marginal cases and seeing the accused acquitted just to satisfy the IMF would seem a fairly pointless exercise.
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Interesting that several contributors have automatically assumed that the lack of convictions for money laundering in Guernsey is an indication that criminals are getting away with it.
Anyone working in the finance industry knows that there are incredibly detailed an complex procedures in place these days to prevent money laudering occuring (and yes they apply equally to old clients as well as new ones).
We need to establish exactly where the money is coming from and, if in doubt, we submit a suspicious transaction form which – if suspicion is confirmed – can lead to a criminal investigation by the police.
Even failing to report a suspicion of money laundering can result in a finance worker facing a prison sentence.
The only way a money launderer is going to get away with it in Guernsey is if they can find a criminal (such as Mr Taylor) working in the finance industry who is prepared to be complicit in their illegal activities.
I would suggest that the reason that there have not been more convictions for money laundering in Guernsey is because it is simply too difficult to commit that particular crime here.
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@ Dani
He may be able to get out on parole licence after 1/3rd of the sentence; i.e. after 10 months or he might not get early release on licence until the 1/2 stage of the sentence; i.e 15 months. If he were to fail to get parole at all, he would serve 2/3rds of the sentence with remission for good behaviour.
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The whole industry is a sham, designed to keep the poor, poor. an make the money laundering pin stripe pirates rich,, WAKE UP…. u all blame the hoodies an single mums for the islands woes, they r just playin the game, like the bankers…
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