Wilton (IOM), a wealth management firm which has a branch in the island, has had its licence revoked by the Financial Services Authority.

The licence was revoked in its entirety on January 24 following a number of failings within and by Wilton.

The move is ‘reasonable, appropriate, necessary and proportionate’, says the FSA. The authority adds: ‘The Authority has determined, that to allow Wilton to continue to hold a licence issued by the Authority and to undertake regulated activities in and/or from the Isle of Man would have a significantly detrimental effect on the maintenance of confidence in the Isle of Man’s financial services industry and its development as an international financial centre.’

The decision was made on a number of identified failings including not having renewed its Professional Indeminity Insurance and not having any operational staff meaning that it had no regulatory compliance function.

The FSA says the company was conducting regulated activities without Professional Indemnity Insurance, following the expiry of its previous indemnity cover on December 29, 2023.

In a report from the Interim Receiver, an officer of the court which acts as a custodian on behalf of a creditor, of Wilton on January 10 this year, the Interim Receiver did not have sufficient funds to pay the required premium or excess required in order for Wilton to obtain new Professional Indemnity Insurance cover despite attempts by Interim Receiver to obtain a capital injection into the business.

Additionally, at the time of the revocation of its licence, Wilton had no operational staff save for its two directors.

Wilton had not had a Head of Compliance since February 24, 2023 or a Deputy Money Laundering Reporting Officer since March 22, 2023.

Furthermore, the director, who was also Wilton’s Money Laundering Reporting Officer, was unable to fulfil their roles. As a result, Wilton had no regulatory compliance or financial crime prevention function.

According to the Report, the financial position of Wilton and its operations significantly deteriorated and Wilton was, in the opinion of the court-appointed Interim Receiver, both cash flow and balance sheet insolvent.

The Interim Receiver, appointed in respect of Wilton, had also been unable to obtain full access to Wilton’s records or those of its clients.

The two directors of Wilton provided minimal assistance to the Interim Receiver in order to facilitate his full access to these systems as well as all of Wilton’s accounting and client records, the FSA says.

The Interim Receiver, in the Report, notes that, taken collectively, these circumstances have had a severe operational impact on Wilton’s ability to continue to operate effectively as a regulated entity. The Authority has concluded that Wilton does not have the required resources to sustain ongoing licence requirements. The Interim Receiver remains in place.