MONEYVAL Fifth Round Evaluation Report December 2016

Summary

The requester sought internal FSA documents and policy guidance regarding changes to regulatory and enforcement approaches following the December 2016 MONEYVAL report, specifically concerning the shift from civil to criminal prosecutions. The provided response text acknowledges the request scope but cuts off before disclosing the actual information or stating the final outcome of the search.

Key Facts

• The request was made under the Freedom of Information Act 2015 to the Isle of Man Financial Services Authority.
• The request focused on the FSA's response to the MONEYVAL Fifth Round Evaluation Report from December 2016.
• The requester narrowed the scope to documents produced on or before 4 August 2017.
• The request sought internal memoranda, emails, and policy documents regarding civil versus criminal enforcement strategies.
• The response text provided is incomplete and does not contain the final disclosure or refusal statement.

Data Disclosed

• December 2016
• 14 February 2018
• 12 March 2018
• 4 August 2017
• IM121011I
• Freedom of Information Act 2015

Original Request

The MONEYVAL Fifth Round Evaluation Report on the Isle of Man of December 2016 (the “Moneyval Report†) concerned among other matters the approach by regulators, including the FSA, to compliance matters and in particular, suggested that regulators (including the FSA) had been over-reliant on the civil regulatory approach and that the use of criminal prosecutions was underused.

Data Tables (1)

Full Response Text

R e s p o n s e t o F r e e d o m o f I n f o r m a t i o n
r e q u e s t IM121011I - P a g e 1 | 4

We write further to your request to the Isle of Man Financial Services Authority (‘the Authority’) dated 14 February 2018 for information under the Freedom of Information Act 2015 (‘the Act’) as follows:

Request:

“The MONEYVAL Fifth Round Evaluation Report on the Isle of Man of December 2016 (the “Moneyval Report”) concerned among other matters the approach by regulators, including the FSA, to compliance matters and in particular, suggested that regulators (including the FSA) had been overreliant on the civil regulatory approach and that the use of criminal prosecutions was underused.

In these circumstances, it is of the utmost importance to understand exactly what the approach of regulators (and in particular the FSA) will be to matters falling within their regulatory sphere following on from the Moneyval Report and whether any changes have been made to their approach – i.e. will they continue with the “light touch” and cooperative approach previously undertaken, or is there a general push within the FSA to undertake prosecutions in order to satisfy/comply with the Moneyval Report. If this is the case it should plainly be made known to the business community generally that this shift in approach has taken place so that they can be properly informed in their dealings with the FSA. This request is therefore being made under the Freedom of Information Act 2015 to obtain information as REFERENCE NUMBER: IM121011I REQUEST UNDER THE FREEDOM OF INFORMATION ACT 2015 Date: 12 March 2018 R e s p o n s e t o F r e e d o m o f I n f o r m a t i o n r e q u e s t IM121011I - P a g e 2 | 4 to the FSA’s approach to compliance and regulation consequent upon the Moneyval Report and any changes to the FSA’s approach generally subsequent to the Moneyval Report.

In these circumstances, this request seeks clarification of the FSA’s response to the Moneyval Report and in order to illustrate such response, the disclosure of any and all:

(1) internal FSA memoranda, emails, correspondence or otherwise, policy documents, guidance notes and/or directions, or other documents, setting out or advising as to the general approach to be taken by the FSA (including, without limitation, its investigative and enforcement officers) in regulatory matters;

(2) guidance documents received from outside advisers and agencies, setting out or advising as to the general approach to be taken by the FSA (including, without limitation, its investigative and enforcement officers) in regulatory matters;

(3) internal FSA memoranda, emails, correspondence or otherwise, policy documents, guidance notes and/or directions, or other document, setting out or advising as to any general changes to the regulatory and enforcement approach of the FSA;

(4) guidance documents received from external advisers and agencies setting out or advising as to any general changes to the regulatory and enforcement approach of the FSA;

(5) internal FSA memoranda, emails, correspondence or otherwise, policy documents, guidance notes and/or directions, or other documents, setting out or advising as to how the FSA would determine whether to pursue civil regulatory action or criminal investigation in any given case;

(6) internal FSA memoranda, emails, correspondence or otherwise, policy documents, guidance notes and directions, or other documents, setting out or advising as to whether the FSA as a matter of policy or guidance regarded (or regards) criminal investigation and prosecution preferable to pursuing civil regulatory action in any given case where both options might exist; and

(7) internal FSA memoranda, emails, correspondence or otherwise, policy documents, guidance notes and directions, or other documents, setting targets or setting out or advising as to how many criminal investigations the FSA should undertake and how many prosecutions should be sought or convictions secured and any timeframe in which such investigations should be undertaken, prosecutions sought or convictions secured, R e s p o n s e t o F r e e d o m o f I n f o r m a t i o n r e q u e s t IM121011I - P a g e 3 | 4

In each case which were created or updated in expectation of, or as a consequence of, or subsequent to, the Moneyval Report (whether or not such document specifically mentions the Moneyval Report)."

Further information you provided on 12 March 2018: “…the request is limited to the FSA’s response to the Moneyval Report and the policies and guidance in relation to regulatory matters in response to the Moneyval Report...

For the FSA’s assistance, in order to narrow the scope of the request, the response may be limited to those documents which were dated or produced on or before Friday 4 August 2017….”

Response to your request Acknowledging that your request relates to documents dated or produced on or before Friday 4th August 2017, in response to questions 1 – 7 of your original request, the answer is that the Authority has made no policy changes nor changed its general enforcement approach toward either regulatory action or criminal investigations as a result of the aforementioned Moneyval Report. There are no documents, nor have there ever been any documents, which fall within the categories referred to in questions 1-7.

All matters are given the same consideration now as they were prior to the publication of the Moneyval Report. There is not, nor has there ever been, a ‘light touch and cooperative approach’ (your words) undertaken by the Authority and all matters are dealt with on the circumstances presented in each particular case.

Your right to request a review If you are unhappy with this response to your Freedom of Information request, you may ask us to carry out an internal review of the response, by completing a complaint form and submitting it electronically (or by delivery/post to the FOI Co-ordinator, Isle of Man Financial Services Authority, PO Box 58, Finch Hill House, Bucks Road, Douglas, Isle of Man, IM99 1DT). An electronic version of the complaint form can be found at www.gov.im/foireview; a paper copy can be requested by contacting the Authority direct. Your review request should explain why you are dissatisfied with this response, and should be made as soon as practicable. We will respond as soon as the review has been concluded.

R e s p o n s e t o F r e e d o m o f I n f o r m a t i o n r e q u e s t IM121011I - P a g e 4 | 4 If you are not satisfied with the result of the review, you then have the right to apply for a review of decisions by the Information Commissioner. This applies to a decision on: 1. Whether we have responded to your request for information in accordance with Part 2 of the Act; or 2. Whether we are justified in refusing to give you the information requested.

In response to an application for review, the Information Commissioner may, at any time, attempt to resolve a matter by negotiation, conciliation, mediation or another form of alternative dispute resolution and will have regard to any outcome of this in making any subsequent decision. More detailed information on your rights to review is on the Information Commissioner’s website at: www.inforights.im/.

If you have any queries concerning this letter, please contact the Authority’s Freedom of Information Coordinator at foi@iomfsa.im. Further information about Freedom of Information requests can be found at www.gov.im/foi.

Freedom of Information Coordinator Isle of Man Financial Services Authority foi@iomfsa.im