An investigation of the conduct of Gufur Hussain by the Jersey Financial Services Commission concluded that he ‘repeatedly failed to disclose conflicts of interest’ to the company he worked for and ‘knowingly provided’ the regulator with false or misleading information.
Mr Hussain worked as a financial adviser in the Island between 2015 and 2019 and was investigated twice by the JFSC during that period.
In 2016, he was probed for potentially launching an unauthorised finance services business, and while cleared of this accusation he was warned for acting with a ‘lack of candour’ during his dealings with the regulator.
And three years later he was investigated again after the JFSC came across documents that raised concerns over his conduct as an independent financial adviser for the company where he was employed.
It was found that he had formed personal friendships with four clients and borrowed £1.19m from them, some of which was via a UK property development company he had set up.
The JFSC concluded that he had knowingly failed to declare ‘conflicts of interest’ that had arisen as a result of these dealings.
‘Failing to declare such conflicts of interest relating to the four clients was an intentional act that enabled him to conceal information that he was required to disclose to Company Y [his employer],’ a statement says.
‘This resulted in Company Y being unable to consider the position of and, if appropriate, offer advice or protection to any of the four clients from whom Mr Hussain obtained the significant personal financial advantage by way of the four loan arrangements.
‘In this respect, the JFSC has concluded that Mr Hussain lacks integrity.’
The investigation also concluded that Mr Hussain continued to have contact with clients when the regulator had imposed directions on him not to do so.
JFSC director general Martin Moloney said: ‘Mr Hussain failed in his obligations to disclose conflicts of interest. Becoming a beneficiary of a client’s investment decisions while being their adviser is the underlying source of the conflicts of interest in this kind of case.
‘Being someone’s financial adviser is a huge responsibility. It is vitally important to be open and frank with your employer and the JFSC. The smart thing for financial advisers to do is make sure they keep their own financing entirely separate from the investment choices of those they advise.’
