The Gibraltar Financial Services Commission (GFSC) found that Gnat Holdings, a subsidiary of the Hawk Group, provided professional trustee services to a Qrops scheme and an occupational pension scheme without appropriate regulatory permission.
The Hawk Group was licensed by the GFSC to provide financial services, but this did not include professional trustee services.
The business was accepted by GHL with the full knowledge that the GFSC had declined to grant consent for the company to conduct this type of business.
Mis-management
In addition to accepting the business without permission, the GFSC found failures in GHL’s management of the Qrops scheme.
This included deficiencies in anti-money laundering controls, failure to ensure compliance with the four eyes requirement and effecting transactions in relation to the Qrops client account without the requisite consent from the regulator.
The watchdog ordered the transfer of the schemes to licensed trustees and told the Hawk Group to stop taking on new business.
GHL was fined for undertaking business without regulatory permission.
Licences
Directors Keith Lawrence and Roudon Zarb have accepted the issued raised and have agreed to step down from their roles at the Hawk Group.
Taking into account their unreserved apology, their admissions, previously long business record in financial services and the consequences of action already taken against GHL, the GFSC has fined the Hawk Group £10,000 ($12,881, €11,783) for undertaking business without regulatory permission.
An additional charge of £10,000 was imposed to help contribute towards the GFSC’s legal costs.
Directors banned
Lawrence and Zarb will not be able to re-apply to any authority for authorisation for a position in financial services for two years.
Additionally, they will surrender their individual and the Hawk Group licences issued by the GFSC, with the exception of Hawk Securities Limited, Solent Limited, and Solent Nominees Limited.
Lawrence and Zarb are in the process of transferring the Hawk Group book of business to another licensed company, at no cost to clients, the regulator said.
Panama connection
GHL and the Hawk Group are two of the many companies listed in the Panama Papers, according to the International Consortium of Investigative Journalists (ICIJ), which broke the Panama Papers story.
GHL is also listed as a shareholder in Jersey-based and British Virgin Island-registered firm Richmond Investment Trading Limited.
Richmond is listed as ‘defaulted’ on the Panama Papers database and was ‘struck off’ on 31 October 2014.
