Dumb diligence

Personal responsibility is very much the name of the game at the moment, with the UK’s new Senior Managers Regime and PSR register both on their way.  The aim is to make individuals take responsibility for their decisions and actions, rather than hiding behind the corporate structure for which they work.  Years ago, when financial investigation was in its infancy, a police detective I knew was making great strides in the then-new area of due diligence.  As we still do today, he often came up against barriers – corporate trustees, incomplete records, unidentified shareholders.  And I asked him how far he went – when did he stop asking questions and demanding information.  “When I touch flesh,” he said grimly.  Hie tone suggested that he meant it literally.  In other words, nothing short of a real live person would do.  And finally it seems that the law is catching up with his attitude.

Hopefully this new emphasis on real live people will put paid to instances like the one recently highlighted by the authorities in Jersey.  On 20 July, the Jersey Financial Services Commission put out a Public Statement concerning the splendidly-named Christian James Bulcock Blair.  Mr Blair, despite working in the regulated sector (i.e. he should have Known Better), took on various additional roles – director, beneficiary, settlor and shareholder – and made a complete Horlicks of them all.  In his capacity as director of the coyly-named Company X, he conducted no due diligence on Company X, attended no board meetings, did not understand the company’s business, or even check that it was still active, and – no surprise here – did not give a moment’s thought to AML considerations.  At least he came clean about his motives: he did it “because it was easy money” – indeed, it was “money for nothing”.  And when it came to his other roles, he allowed his name to be used on various documents in a “dummy” capacity (dummy as in not real rather than dummy as in stupid, although….), again “for the money”.  Unsurprisingly, Mr Blair has been banned from Jersey’s regulated sector – and he can count himself lucky that he fell from grace before Jersey introduces any harsher regime of personal accountability, as surely it will.

This entry was posted in AML, Due diligence, Money laundering and tagged , , , , , , , . Bookmark the permalink.

2 Responses to Dumb diligence

  1. Roy McCarthy says:

    He would have done well in the old days as a Sark-resident director of hundreds of companies – signing minutes of board meetings down at Creux Harbour 🙂 Happy days.

  2. I am sure that you, like I, regularly meet people who are nostalgic for the old ways, when a man’s word was his bond and we didn’t have to bother lovely clients with this intrusive due diligence…

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s