Belvedere: Guernsey regulator blocks “unilateral surrender” of Lancelot licence

Guernsey Financial Services Commission logoIt was an eventful last two weeks of my 15 years at Moneyweb, the company I started from above my garage in 1997. During October 2012, a colleague uncovered that one of our subsidiaries, Editors Inc, had been bribing an SAA procurement officer to get its “SA At A Glance” book carried on the airline’s flights. We met the top team at SAA, including its Finance Director and the Head of Investigations. Although the evidence was conclusive, SAA asked us to withhold publication until they assessed all the facts from the airline’s side. On later inquiry they shared that the dirty procurement officer swiftly resigned, ending SAA’s investigation. With the net rapidly closing in, the principals behind Belvedere tried a similar tactic with their Lancelot Management Limited last month. Today’s official communique republished below explains that the duo tried to close Lancelot, but the Guernsey Financial Services Commission was having none of it, rejecting the “unilateral surrender of the licence”. There’s no easy way out of this one for Belvedere’s kingpins Cobus Kellermann and David Cosgrove. On Friday, the last Guernsey-registered part of their crumbling empire, Trinity Global Fund, is set to go the same way of the others – having its operations suspended so investors’ assets still left in the fund can be protected. Guernsey’s investigations, which have already turned up damning evidence against Kellermann and Cosgrove, are continuing. As they are in Mauritius where, last Friday, the authorities suspended the licence of the top company in the group, Belvedere Management. – Alec Hogg

From the Guernsey Financial Services Commission:

On the 24 April the applications made by The Guernsey Financial Services Commission, under the Protection of Investors (Administration and Intervention) (Bailiwick of Guernsey) Ordinance, 2008 for the appointment of Administration Managers to Lancelot Management Limited and Trinity Global Fund were adjourned until the 1 May 2015.

During the interim period Mr Daryn Hutchinson a director of Lancelot Management Limited made application to the court, under Section 406 of The Companies (Guernsey) Law, 2008, for Lancelot Management Limited to be compulsorily wound up, and further to have Grant Thornton Limited appointed as liquidators. On 1st May 2015 The Bailiff, ordered that Lancelot Management Limited be compulsorily wound up pursuant to section 406 of the Companies Law.

Notwithstanding the interjection of the Liquidation application the Bailiff considered that the action of the Commission in bringing proceedings under the Administration and Intervention Ordinance was reasonable and ordered that the costs, charges and expenses incurred by the Commission as a consequence of it taking regulatory action are properly incurred in the compulsory winding up of Lancelot Management Limited and are payable from its assets in priority to all other claims pursuant to section 418 of the Companies Law.

The Court also ordered that the Company’s purported unilateral surrender on 21 April 2015 of the licence held by it pursuant to the Protection of Investors (Bailiwick of Guernsey) Law, 1987 (“POI Law”) was ineffective in law because the POI Law does not permit surrender of a licence granted to a licence holder. The Bailiff held that Lancelot Management Limited continues to hold a licence under the POI Law.

Matters pertaining to the Trinity Global Fund have been further adjourned until 7 May 2015.

The Commission continues to work closely with other regulatory partners and law enforcement authorities with regards to the global operation of companies linked to these matters, and investigations continue in that regard.

* Click here to read the “back story” and access links to all the Biznews.com coverage of the Belvedere saga. 

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