A complicated tribunal case involving a trust administration company incorporated in the Qatar Financial Centre and its regulators has come to an end with total victory for the regulators.

Some time ago, the QFC Regulatory Authority took enforcement action against Horizon Crescent Wealth and imposed a fine of 30 million riyals [US$8,240,061] on it for "serious legal and regulatory breaches." This sprang from a QFCRA investigation which found that Horizon had flouted the Anti-Money Laundering and Combating Terrorist Financing Rules 2010. It also transpired that the firm had marketed/held itself out an asset-management business without permission from the QFCRA, thereby contravening the Qatar Financial Centre Law No (7) 2005 and the Financial Services Regulations.

Horizon was licensed in the Qatar Financial Centre on 4 February 2015 as a trust administrator. Although trust administration does not require authorisation from the QFCRA, it was nevertheless required to comply with the AML rules. During its investigation, the QFCRA spotted serious deficiencies in its CDD or "customer due  diligence" and the background checks that it ran on the sources of its HNW customers’ funds and the nature of their economic activities.

The QFCRA’s investigators found that Horizon had taken deliberate steps to mislead them about its activities. They also found out about its masquerade as an authorised asset-management-service firm.

Having discovered all this, the regulators froze all Horizon’s accounts and all related accounts of customers; those accounts remain frozen to this day. Horizon appealed against this action (and against the hefty fine) to the Regulatory Tribunal, hence the recent case. The trust firm argued that the fine was excessive. The appeal was really two appeals in one, hence its complexity.

On 19 March, the tribunal found in favour of the QFCRA, also requiring Horizon to pay the costs and expenses of the QFCRA’s investigation and a portion of its costs relating to the appeal.  

The QFCRA received plenty of help in the case from the Qatari Central Bank, the Qatari Financial Information Unit and the Public Prosecution Office. The case was a complex one; the "hearing bundles" (all the documents brought together by the appellant, Horizon, for the twin actions which the tribunal heard together) exceeded 14,000 pages.