One of my great ambitions – which I achieved for a short while in one jurisdiction – is to facilitate communication and foster understanding between the three sides of the AML triangle: regulator, law enforcement and industry. Now, that’s a big ask, and my particular method was to offer training to all of them and to take, as the focus of that training, what is actually achievable in the world of AML. So I told the regulator and law enforcement, for example, what MLROs could actually do with regards to CDD (e.g. it’s all very well telling them that they have to verify beneficial ownership, but you must recognise that very few jurisdictions – yet – offer reliable registers). And I reminded MLROs and law enforcement that regulators are charged with protecting the stability and reputation of their jurisdiction and that they will, if circumstances demand it, cut loose a rogue institution in order to preserve the rest. And I helped MLROs and regulators to understand that law enforcement are often not financial experts and that they have to present a certain standard of evidence to the court in order to be allowed to proceed. It was great fun – I loved it. But there isn’t much call for that sort of training: most people just want to know the law and what they have to do to stay out of prison.
So when I see a regulator trying something new to fill this gap in understanding, I give a cheer of approval. It’s the Guernsey Financial Services Commission, and a couple of weeks ago they announced a six-month pilot initiative of exit interviews for MLROs and/or MLCOs [that’s a Guernsey/Jersey thing, the Money Laundering Compliance Officer] who leave their role at a bank or fiduciary firm from January 2020 onward. To quote from their website, “the aim of the individual meetings is for regulators to develop a deeper understanding of the MLRO/MLCO role(s), responsibilities and challenges faced”. Now I know that there will be some who will say that it’s none of their business and it’s just meddling and it will encourage people to dish the dirt on unpopular colleagues, but I’m assuming that an MLRO thus summoned can simply say, “I’m leaving for personal reasons” or “I just didn’t like the work”. And for an MLRO who is leaving because the workload is too great or because he is not receiving the support he needs from his Board or because he has lost the will to fight the tide of money laundering that is overwhelming his jurisdiction [not a likely scenario, but some might feel it], well, isn’t it right that the regulator should know that? Oh what I’d give to be a fly on the wall at those interviews, and I very much hope that the regulator will (a) continue the initiative after the six month pilot, and (b) publish their (anonymised) findings from these interviews. In the meantime, I salute the bravery and imagination of the GFSC.
Is there any protection for whistleblowers in Jersey or Guernsey legislation yet, I wonder?
I don’t think so – at least, I haven’t read any updates since this Mourant briefing (December 2018): https://www.mourant.com/news-and-views/news/2018/morsel–whistleblowing-by-employees.aspx But more than happy to be corrected by anyone who knows better.
Hi Susan, the GFSC gave a bit more context around this at a recent GACO seminar (a very interesting dive into how a Moneyval evaluation works). There had been a lot of questions on whether this would breach confidentiality contracts…..Fiona Crocker confirmed it won’t. Other confirmations included that it is voluntary…..but, will raise questions if an invited party refuses to attend. There will be no involvement from licensees & there will be no feedback to licensees. GACO have agreed to collate further questions & feed back responses to industry. The trial will be about 5-6 months & then consideration will be given to expanding or stopping it. Best regards Jo
Welcome to the blog, Jo, and thank you so much for this extra information. The more I hear, the more I think it is a really interesting and imaginative initiative. There will always be concerns with new things, but if the information enables the GFSC to better understand the challenges of the role of the MLCO/MLRO – and therefore to make the legal obligations more realistic – that can only be good. I shall watch with interest! Best wishes from Susan