A SPECIAL financial task force has placed a number of Jersey businesses on a ‘high risk list’ after they were found to be providing services to sanctioned Kremlin-linked oligarchs and businesses.
In a fast-paced investigation launched as the UK government hit individuals and businesses with a series of sanctions and asset freezes, the newly formed island-based group carried out urgent inquiries into 613 people, businesses and trusts.
Although the majority of companies were found to be clean, the task force – made up of members of the Jersey Financial Services Commission, state police and government – has now compiled a list of companies considered to be presenting a high risk of facilitating money. – money laundering or financing of terrorism after “sanctioned names” have been found in their clientele.
Those on the list will now be closely monitored and could be subject to enforcement action, including operating bans or criminal prosecution.
Speaking to the JEP in the task force’s first interview since its launch, Diane Maxwell, JFSC’s executive director of policy and risk, said entities contacted had a week to respond to questions about their operations.
“We were asking specific questions about the data relating to Ukraine, Belarus and Russia. We usually gave them over a week to respond, but 92% came back within a week. Returns would arrive at 9 p.m., 10 p.m., 11 p.m. or five to midnight,” she said.
“It tells us that the industry has reacted. They take this seriously and review their exposure.
She added that after collecting the first wave of responses, the regulator assessed the results, which included data on 568 entities, and identified a list of “high risk” companies.
“The risk team carried out a risk analysis and compiled a list of entities and companies that we would visit during the week. The supervision team then came in and visited with this group.
“We put them on a high risk list because we went through the list and said, as far as we are concerned, they have sanctioned names on their customer base. We share this with the Financial Intelligence Unit. We re-examine that group and after that comes law enforcement.
We’re seeing a lot of really good work and we’re also seeing a subset of entities that we’re not comfortable with and going back to.
The task force declined to release the exact number of companies on the high-risk list or comment on individual cases.
The most important person among the 1,000 sanctioned by the UK and Jersey is Chelsea FC owner Roman Abramovich, who the JEP said was linked to a £1.5billion loan from a company of Jersey registered in a company based in Colomberie.
Ms Maxwell said dealing with the “absolutely unprecedented” level of sanctions that had suddenly been introduced was an opportunity to improve the reputation of the island’s financial services sector.
“We all felt it was time for Jersey to step in and show that we are going to protect and enhance the reputation of Jersey, the international financial centre,” she said.
Jersey government compliance officer Dan Marcos said the number of sanctions against Russian individuals had multiplied several times in a very short time.
“Under Russian rule until the invasion, there were over 200 asset freeze sanctions related to human rights, corruption, the 2014 Crimean invasion and all that. happened in the last eight years,” he said.
“After the invasion, we saw an unprecedented set of sanctions against a G20 country.
We have gone to over 1,000 asset freeze designations and expect hundreds more.
At the end of this month, the Foreign Minister is due to publish data on the value of the frozen assets.
The Guernsey government recently revealed that funds based there hold up to £12 billion in Russian assets.