Sipp provider legal challenge puts probe on hold

Sipp provider legal challenge puts probe on hold

A probe into a provider of self-invested personal pensions has been put on hold pending a court appeal.

The Gibraltar Financial Services Commission had appointed inspectors to investigate STM Group but the firm has challenged the grounds on which this decision has been made.

It means the Gibraltar Supreme Court will now hear arguments on Monday 22 January 2018 about whether the inspectors should be appointed.

The court has also varied a privacy and anonymity order so the appeal hearing can take place in public.

STM Group's chief executive, Alan Kentish, was arrested in Gibraltar in October over allegations of failure to disclose information over a tax dispute involving a client.

But he was later released without any charge and an application for judicial review against the Royal Gibraltar Police was filed to the Supreme Court.

At the time of Mr Kentish's arrest, STM said one of its clients has been involved in a dispute between two countries, between 2008 to 2013, over their respective taxing rights to the taxes correctly paid by him.

Until it was clear that the issue was a tax dispute, Mr Kentish followed compliance procedures in filing two relevant suspicious activity reports, which were externalized to the Gibraltar Financial Intelligence Unit, the company said.

Under Gibraltar legislation, the GFIU must respond within 14 days if it wishes to direct any action to be taken and a lack of response was understood by STM to mean to continue as normal.

But on 19 October, Mr Kentish was arrested by the Royal Gibraltar Police on the allegation of failure to disclose under the Proceeds of Crime Act 2015.

STM has administrative offices in the UK, Malta, Jersey, Spain and Gibraltar, with its head office based in Gibraltar but it is currently reviewing the location of its head office, given its operational requirements.

Last October, STM completed the acquisition of pension provider London & Colonial, which had a Sipp business with approximately 2,000 members and a turnover of £1m.