JERSEY DIRECTOR CONDUCT LACKED INTEGRITY AND COMPETENCE SAYS JFSC….

The Jersey Financial Services Commission (the “Commission”) issues this public statement under Article 25(a) of the FS(J)L with respect to directions issued to Mr McKimmon under Article 23 of the FS(J)L.

The Commission’s actions support its objectives of reducing the risk to the public of financial loss and protecting and enhancing the reputation and integrity of Jersey in commercial and financial matters.

An investigation into the fitness and propriety of Mr McKimmon, in his capacity as a former principal person of HTJL, has taken place and the Commission has concluded that, in all the circumstances, Mr McKimmon acted without integrity, and his displayed level of incompetence was of the most serious kind.

Mr McKimmon was appointed as a director of HTJL on 8 June 2009, occupying the position of Head of Trust and Fund Administration. In this position, two of Mr McKimmon’s fellow HTJL directors reported to him.

The majority of Mr McKimmon’s time was spent dealing with the issues arising from HTJL’s administration of private fund structures, including the Media Fund in respect of which Mr McKimmon acted as a director to its General Partner.

Summary of Findings

The Commission has previously concluded that HTJL breached all seven principles of the Codes of Practice for Trust Company Business, including failing to conduct business with integrity, failing to ensure conflicts of interest were managed and failing to act in the best interests of customers. As a director and Head of Trust and Fund Administration of HTJL, Mr McKimmon bears significant responsibility for these failings.

Mr McKimmon, as a director and Head of Trust and Fund Administration of HTJL, shares responsibility for the following:

a confused and ineffective corporate governance structure;
a failure to oversee and control the business of HTJL through the implementation and monitoring of robust systems and controls;
a failure to realise a Horizon services company was conducting unauthorised financial services business;

a lack of transparency over fees levied to customers; and
a failure to manage risk and to identify and address issues facing HTJL.

Mr McKimmon’s conduct lacked integrity and competence