Jersey's first Deferred Prosecution Agreement (DPA), Afex Offshore, was also fined £408k + 60k AG costs.

Afex Offshore (Jersey) Limited [AOL] have entered into a Deferred Prosecution Agreement (DPA) with the Attorney General. AOL are the first entity in Jersey to enter such an arrangement under the new Criminal Justice (Deferred Prosecution Agreements) (Jersey) Law 2023 (DPA Law)

• The law - https://www.jerseylaw.je/laws/enacted/Pages/L-02-2023.aspx
• The DPA between AOL and AG - https://www.jerseylaw.je/judgments/unreported/Pages/[2024]JRC271.aspx

The DPA Law allows corporate entities to avoid prosecution by entering a DPA with the Attorney General (AG)

• The AGs guidance is here https://www.gov.je/SiteCollectionDocuments/Crime%20and%20justice/AG%27s%20DPA%20Guidance.pdf

As part of the agreement a FINANCIAL FINE (408k + 60k AG costs) was also applied:-

• The Attorney General’s application took as a starting point for the financial penalty for Counts 1 to 5, the sum of £850,000 for each count; for Counts 6 to 10, £100,000 for each count; and for Count 11, £200,000, with all sentences being concurrent to each other.
•  The Attorney General then gave full credit of one-third equivalent to the reduction made for a guilty plea amounting to a reduction of £283,000 from the starting point of £850,000.[£567,000.00]
• Furthermore, the Attorney General gave credit for AOL’s early remedial measures and steps taken to rehabilitate its business, which caused additional financial hardship when AOL had a small staff who had remained committed to the DPA process. This led to a further reduction of £158,760 once a one-third discount had been applied, leading to a proposed financial penalty of £408,240. This figure was explained in the Attorney General’s submissions as a further deduction of 28% of the figure remaining once a one-third discount had been applied to the starting point.
• The DPA also provided for immediate payment of the Attorney General’s costs of £60,000.

The failures leading to the DAP are shown as follows:-

1. Counts 1 to 4 all involved failures to comply with the requirements of Articles 3 and 13 of the Money Laundering (Jersey) Law 2008, contrary to Article 37(4) of the Proceeds of Crime (Jersey) Law 1999. 
   
   1. 1. Each count related to a failure to apply identification measures in relation to an application by [redacted] who applied to open an account with the Defendant in Jersey. 
      2. The transaction she carried out through the Defendant involved the Defendant receiving €3 million from her via a third party.
      3. The sum received by the Defendant represented the sale of certain bonds and the distribution of the sale proceeds. The Defendant received £12,045.30 by way of revenue.
      4. The remainder was all distributed out to various persons and entities.
2. Count 5 relates to the same transaction and deals with the failure to properly scrutinise, identify and address the money laundering risks arising from the transaction, which should have been apparent to AOL, as well as money laundering risks emerging from information AOL discovered while carrying out the transaction and the subsequent distributions.
   
   1. 1. AOL failed to clearly understand the bonds' source of funds, their ultimate beneficial owner, and the relationship between the individuals involved
      2. AOL also failed to obtain
         1. Properly documented identification documents of those individuals and
         2. A clear rationale for the distributions being made and for whose ultimate benefit they were being made
      3. These were serious findings
3. Counts 6 to 10 represent offences related to AOL’s monitoring and compliance with Article 16 of the Money Laundering Order regarding four client relationships. 
   1. 1. Counts 6 to 9 all relate to a failure to conduct tests on four different entities whose policies and procedures AOL relied on to support identification measures for anti-money laundering purposes
      2. The relevant entities were IQEQ (Jersey) Limited, [redacted].
      3. There were two counts for IQEQ because the relevant provisions of the Money Laundering Order had altered when the relevant conduct, the subject of the indictment, occurred.
4. Count 11 related to a failure by AOL to
   1. 1. “properly scrutinise and address the money laundering risk of placing reliance on IQEQ Jersey Limited following the imposition of a financial penalty and the issuing of a public statement on 1 July 2022 in relation to IQEQ (Jersey) Limited”.

Concerning the above the DPA and paragraph 5 of the Agreed Statement of Facts say:-

1. “Although a single transaction, the facts in relation to Counts 1-5 illustrate numerous and significant departures from the standards required by the MLO. That the transaction was permitted to occur at all, exposed Jersey to a high risk of money laundering without those risks being increased by the behaviour in Counts 6-11.
2. The actions by individuals within AOL at the time indicate that they must have realised this risk yet drove the transaction forward.
3. The individuals at AOL involved directly in the transaction were motivated by the prospect of repeat business.
4. This brought about circumstances where AOL's obligations under the MLO took second place and ultimately led to the commission of serious criminal offences.”

The Criminal Justice (Deferred Prosecution Agreements) (Jersey) Law 2023 (DPA Law) allows corporate entities to avoid prosecution by entering into a Deferred Prosecution Agreement (DPA) with the Attorney General.

Here are the key points:

1. Purpose: A DPA is an agreement between the Attorney General and a corporate entity that could be prosecuted. It allows the entity to make reparations for its criminal conduct without the damaging consequences of a conviction
2. Process:
• Self-Reporting: Entities must submit a self-report via secure email, detailing the offence and providing evidence
• Negotiation: The terms of the DPA are negotiated, including penalties, costs, and compliance measures
• Court Approval: The DPA must be approved by the Royal Court to ensure it is in the interests of justice.
3. Content of a DPA:
• Statement of Facts: A detailed account of the offence, which becomes a public record
• Penalties and Costs: Financial penalties and costs associated with the investigation and prosecution
• Compliance Measures: Requirements for the entity to implement measures to prevent future offences
4. Termination and Breaches: The DPA can be terminated if the entity fails to comply with its terms, leading to prosecution
5. Independent Monitor: An independent monitor may be appointed to oversee the entity’s compliance with the DPA

 Afex Offshore (Jersey) Limited is a regulated entity in Jersey, primarily involved in investment and money service businesses. Here are some key details:

1. Location: The company is located at Vantage House, Third Floor, 5 Anley Street, St Helier, Jersey, JE2 3QE
2. Regulated Activities:
• Investment Business: They deal in investments and provide investment advice, subject to certain conditions
• Money Service Business: They are also involved in carrying out money service business
3. Management: The senior management includes James Benjamin Lawrence and Jonathan David Gardner
4. Company Type: It is registered as a private company in Jersey

Sources

1. https://www.jerseylaw.je/laws/enacted/Pages/L-02-2023.aspx
2. https://www.jerseyfsc.org/industry/regulated-entities/entity/72297): [Jersey Financial Services Commission](https://www.jerseyfsc.org/industry/regulated-entities/entity/72297)
3. https://opencorporates.com/companies/je/EXTUID_302946): [OpenCorporates](https://opencorporates.com/companies/je/EXTUID_302946)
4. Afex Offshore Limited - Jersey Financial Services Commission. https://www.jerseyfsc.org/industry/regulated-entities/entity/72297
5. AFEX OFFSHORE LIMITED :: Jersey :: OpenCorporates. https://opencorporates.com/companies/je/EXTUID_302946
6. https://www.jerseylaw.je/judgments/unreported/Pages/[2024]JRC271.aspx
7. Attorney General’s Guidance - Government of Jersey. https://www.gov.je/SiteCollectionDocuments/Crime%20and%20justice/AG%27s%20DPA%20Guidance.pdf.
8. Deferred Prosecution Agreements (DPA) – an update | Oben Law & Oben .... https://www.oben.je/deferred-prosecution-agreements-dpa-an-update/.