Over 200 compliance and financial services professionals gathered at the Villa Marina on Friday 30th to celebrate the tenth anniversary of the Alliance of Isle of Man Compliance Professionals signature event, the annual Manx State of the Nation summit.
AICP Chairman Mr Graeme Snape opened proceedings with a welcome address which celebrated the growth of the AICP since its establishment in 2005. He recognised the increasingly prominent role the compliance profession plays in helping to shape the Island’s reputation as an international regulatory leader and in becoming a responsible global partner.
Mr Snape then welcomed Chief Minister Allan Bell for the first of the day’s keynote speeches, which described two milestones of change for the economy. After noting 30 years of continuous economic growth on the Island, Mr Bell reminded the floor that “the challenge of adjusting to the new world order is the big task in front of us, and it is one that we must address together”. Here, as well as to the Isle of Man’s recent signing of the Automatic Exchange of Information Agreements, Minister Bell alluded to a great deal more change for the Island as it prepares for the 2016 national risk assessment on AML procedures conducted by MONEYVAL, as well as the implications of the Vickers Report on banking reform, the Fourth European Money Laundering Directive and the UK general election, “which will bring challenges, but also new opportunities.” Finally, Mr Bell outlined plans for the forthcoming merger of the Isle of Man Financial Supervision Commission and the Insurance and Pensions Authority, all of which were issues later discussed in greater detail.
Chief Executive of the FSC, John Aspden, and Chief Executive of the IPA, David Vick then gave a local sector update. Mr Aspden cited priority areas for the FSC as being consumer protection, banking reform, the national risk assessment and the registration for AML supervision of Designated Non-Financial Businesses and Professions, or DNFBPs. Mr Vick focused on the work ahead for the IPA in further enhancing its regulatory framework to comply with the revised International Association of Insurance Supervisors’ Insurance Core Principles. He commented that a further update to the IPA’s regulatory roadmap could be expected and also updated the audience on the Island’s approach to Solvency II equivalence. Both Mr Aspden and Mr Vick recognised the impact of the FSC and IPA merger on resources and work programmes but committed to remaining focused on the important areas of work required.
Following a mid-morning coffee break, sponsored by the International Compliance Association and Willis Isle of Man, Colin Goodwin of the Income Tax Division and Annemarie Hughes of Dougherty Quinn discussed tax information exchange requests. For the benefit of the floor, Mr Goodwin began by detailing the practicalities of submitting a request for tax information, after which Ms Hughes described the process of responding to such a request. Both presenters were keen to point out the importance of complying with information exchange regulations, the likelihood that these will grow in number in the future, and reminded delegates of the 90 day response deadline.
International perspectives formed the basis of discussion for the morning panel session, during which the AICP was pleased to welcome Chris Hamblin, Editor of Offshore Red, Nick Maxwell of Transparency International and John Baker of MONEYVAL. Together, they discussed such issues as beneficial ownership, the practical applications of FATF requirements, and preparation for the Isle of Man’s forthcoming MONEYVAL assessment. The Island’s success in balancing its role as a leader in financial services regulation with its subsequent exposure to the policy of larger, onshore jurisdictions and territories also formed the focus of a series of enlivened debates which neatly introduced the presentation that followed, ‘DED initiatives – what is being done and how compliance functions can assist’.
Conducted by the Department of Economic Development’s John Spellman and John Garland, this presentation tackled a number of issues of particular pertinence to today’s business landscape. Chief amongst these was the perceived role of compliance professionals as ‘gatekeepers’ of new business opportunities and, as such, the importance of remaining commercially minded in that capacity. Both acknowledged that the burden of international regulation was such that the Isle of Man is no longer as responsive to economic opportunity as it once was, but that the Island’s professionals were nevertheless looking to the future to create a measured business risk environment in which to flourish.
The DED’s Chief Executive of e-Gaming Development, Peter Greenhill, and Sian Jones of crypto-currency compliance consultancy, COINsult followed lunch, kindly sponsored by Accuity, to discuss the challenges and opportunities of decentralised applications for the Isle of Man. Measures to attract and mitigate the risk of cryptocurrency business were high on the agenda, as were the ramifications of press surrounding the technology. Closing remarks centred upon the European Banking Authority’s 2014 Opinion on Virtual Currencies, with Ms Jones emphasising that although it represents a solid foundation on which business could educate their compliance departments, many of the risks listed are by no means unique to crypto-currency business.
In keeping with the summit’s assessment of the financial landscape, the future shape of banking formed the title of the following presentation from PwC’s Financial Services Advisory Partner, Miles Kennedy. Mr Kennedy measured the performance of the major banks upon a ratio of risk to commerciality, finding that many of the major banks were failing to support businesses in their bid to create a responsible and enterprising economic climate. More effective risk management procedures were urged, as was the need for compliance professionals to work together to assuage banks’ reticence to engage new business during a period of significant reform.
The final session of the day saw Mark Denton of The Association of Corporate Service Providers, Mark Waterhouse of the Isle of Man Bankers Association, Paul Kneen of the Isle of Man Funds Association Committee, Gill Marples of the Manx Insurance Association, and Mr Spellman discuss the impact of increasing regulation on industry, the cost of compliance, industry consolidation, banking, and the Island’s economic development. Moderated by Ita McArdle, highlights included the issue of reciprocal trust between businesses and regulatory bodies, particularly in light of the proposed FSC and IPA merger, as well as the importance of remaining client focused in the face of increased regulatory responsibility. Mr Snape then returned to the stage for a tenth anniversary prize draw, which saw one lucky delegate awarded with a phone and tablet prize from Sure.
Commenting on the event, Mr Snape said: “It was clear throughout that the Island’s regulatory environment is undergoing a period of transition. After significant developments last year, businesses are now preparing for yet more change over the coming 24 months. This, understandably, has raised some concern, but also unearths new opportunities. In both respects, this is precisely the role of the AICP’s Manx State of the Nation summit in providing a forum in which compliance professionals can get together to address these issues openly. I would like to thank our sponsors, speakers and attendees, and highlight the fantastic work of our AICP member organisers, every one of whom volunteered to put this event together. We look forward to seeing you all again next year.”
Ian Clague , Senior Partner of PwC, lead sponsor of the conference for 2015, also commented: “The AICP highlights the role of all Manx professionals, regardless of function, to consider the importance of compliance to their business and overall perceptions of the Isle of Man. It is a remarkable event which grows stronger every year and is at the heart of the Island’s financial services offering. We are very pleased to be part of the tenth anniversary celebrations.”
Photo - Graeme Snape, Chairman of the AICP, gives the welcome address.
