Gemini Wealth Group Ltd (GWG) is comprised of the following Financial Conduct Authority (FCA) regulated businesses to which this policy applies:
- Gemini Wealth Management Ltd (GWM) – a financial advisory and wealth management firm Gemini Asset Management Ltd (GAM) – a discretionary investment management firm
Both firms are wholly owned by GWG, a non-trading, non-regulated holding company, controlled by common ownership and directors, and share common staff operating across both firms. GWG is not authorised by the FCA.
As such, both firms apply common standards in terms of the systems and controls applied to Conflicts of Interest, and consequently this policy applies to both firms.
References to “we” or “the firm” in the remainder of this document mean Gemini Wealth Group and the above subsidiaries, unless indicated otherwise.
We define a ‘conflict of interest’ as a situation where the firm, an employee, or other associate of the firm, has the potential to undermine the impartiality of a person because of the possibility of a clash between the person’s self-interest and professional interest, or even public interests. This may prevent services being provided to clients in an independent or impartial manner.
Under the FCA’s Principle for Business, Principle 8 (Conflicts of interest) we are required to pay due regard to the interests of each client and to prevent or manage any conflicts of interest fairly, both between our firm and our clients and between a client and another client.
The FCA’s Principle for Business, Principle 12 (Consumer Duty) and the cross-cutting obligation to ‘act in good faith’ (PRIN2A.2) also have a bearing on how we identify and manage conflicts of interest in practice.
It is important to recognise the risk of conflicts of interest and their impact on how decisions and operations are perceived. Therefore, we are fully committed to identifying, monitoring, and managing all actual and potential conflicts of interest that can or may arise between us and our clients and any person directly or indirectly associated with the firm.
At least on an annual basis, our senior management team will receive a written report providing details of the kinds of services or activities carried out by GWM and GAM in which a conflict of interest entailing a risk of damage to the interest of one or more clients has arisen or, in the case of an ongoing service or activity, may arise.
Identifying Conflicts
We pledge to take all reasonable steps to identify conflicts of interest as they arise or potentially arise, during the provision of our services to clients, between:
- The firm – this will include all employees
- Any person that is directly or indirectly linked to the firm
- The firm’s clients
Types of Conflicts
Conflicts of interest can arise in many different situations such as from system or policy deigns. When we assess potential or current conflicts of interest, we will assess whether the firm, a relevant person, or a person directly or indirectly linked to the firm has put themselves in a position to cause a potential conflict of interest. When making these assessments, there are a few things we look for, including if
those involved:
- Are likely to make a financial gain, or avoid a financial loss, at the expense of a client
- Have an interest in the outcome of a service provided to a client
- Have an interest in the outcome of a transaction carried out on behalf of a client
- Have a financial or other incentive to favour the interest of a client or group of clients over the interests of another client
- Carry on the same business as a client
- Receive, or will receive from a person other than a client, an inducement in relation to a service provided to a client. It could be in the form of monies, goods or services. This will exclude adviser charges, commission payments or other fees for that service
Business Model
Before we recommend that clients use the services of an associated firm, which has common ownership, we will consider other reasonable options for the client.
Inducements to Staff
Staff are not permitted to accept gifts, entertainment, or any other similar benefit (financial or non-financial) unless it enhances the quality of our firm’s service and doesn’t have a detrimental impact on the quality of service we provide.
If in doubt as to whether a benefit is allowable, all staff must consult the Compliance Manager before accepting it or decline to accept it.
Staff are required to disclose any gifts, entertainment, or other similar benefit they have been offered (whether allowable or not). A record of all benefits is made and retained on the firm’s inducements register, which is regularly reviewed to ensure that no detrimental impact has resulted.
Similarly, our staff are not allowed to place undue pressure on clients to persuade them to trade through the firm to the extent that this gives rise to a conflict of interest between that client and another client.
Segregation of Duties
We strive to ensure that the performance of multiple functions by relevant persons does not and is not likely to prevent those persons from discharging any particular functions soundly, honestly and professionally. Our policies concerning the segregation of duties within the firm and the prevention of conflicts of interest are laid out below.
We are aware that effective segregation of duties helps to ensure that no one individual is completely free to commit the firm’s assets or incur liabilities on its behalf. Segregation also helps to ensure that the firm’s senior management receives objective and accurate information on financial performance, the risks faced by the firm and the adequacy of its systems.
Where we are unable to ensure the complete segregation of duties due to a limited staff base, we have adequate compensating controls in place including the frequent review of an area by relevant senior managers. The firm ensures that its relevant persons are aware of the procedures which must be followed for the proper discharge of their responsibilities.
Remuneration
Staff remuneration will be assessed on an ongoing basis to ensure that employees remain motivated, but without encouraging inappropriate behaviour.
Business Interest
The firm recognises that situations may arise where employees have an interest in business being transacted as part of the firm’s business activities. It is for this reason we require all employees to disclose such interests so that appropriate steps can be taken to manage or prevent conflicts of interest from occurring.
For example, an employee may have an interest or Directorship of another company. We expect all employees to disregard that interest when acting on behalf of a client.
Personal Account Dealing
Our staff may buy, sell or hold the same investments as our clients. We control personal account deals by ensuring that all such deals are identified and where applicable approved by management prior to execution. All staff, irrespective of their position in the firm sign on an annual basis to confirm their understanding of our procedures.
Details of our procedures for this area are covered later in this document.
Declining to act
Where we consider we are not able to prevent or manage the conflict of interest in any other way, we may decline to act for the client.
Disclosure
Occasionally, situations may arise where the firm or a client may have some sort of interest in the business we are transacting for another client. If this situation does ever arise, we will write to the client to inform them of our situation and we will not take any further steps until they have confirmed to us what they wish the next steps to be.
This disclosure will include the nature of the conflict and the steps that have already been taken to mitigate the risk to the client. This will include sufficient detail to allow the client to make an informed decision on how they which to proceed.
The firm we will do everything possible to avoid any harm to its clients.
In extreme circumstances, if we as a firm feel the conflict of interest cannot be managed, we may decline to act on behalf of a client.
Recording
Both GWM and GAM will keep and maintain a record of circumstances in which a conflict of interest may arise, or has arisen, as a result of the activities carried out by the firm. This Conflicts of Interest Register will be reviewed by management on a regular basis and will help us to prevent the same conflicts arising again.
Managing & Disclosing Conflicts
The measures for dealing with conflicts are designed to ensure that relevant persons engaged in different business activities involving a conflict of interest carry on those activities at a level of independence, appropriate to the size and activities of the firm and of any group to which it belongs and to the of the risk of damage to the interests of clients.
Examples of procedures for managing conflicts include:
- Effective procedures to regularly review the distribution arrangements of the products and/or services the firm manufactures and/or distributes to ensure that they support a proper management of conflicts of interest.
- The separate supervision of relevant persons whose principal functions involve carrying out activities on behalf of, or providing services to, clients whose interests may conflict, or who otherwise represent different interests that may conflict, including those of the firm.
- Allocating responsibility for conflict of interest management to a Senior Manager and recording this obligation in their statement of responsibilities.
- Bringing in an independent support service company to review our policies and procedures
Staff Understanding
All of the firm’s employees are made aware of this policy and will receive training to highlight and emphasise the importance of identifying and managing conflicts of interest.
Compliance with this Policy
If the firm has reason to believe that a person subject to the policy has failed to comply with it, it will investigate the circumstances.
Sanctions
If interests are not disclosed and there is a subsequent complaint or litigation on the grounds of impropriety, disciplinary action may follow.
Review of conflicts of interest policy
This policy will be assessed and reviewed on at least an annual basis.
If you have any questions, then please don’t hesitate to contact the Compliance Manager via compliance@gemini-wm.com or 0121 354 2700.
Personal account dealing
It is an offence to profit from a financial transaction, either directly or indirectly, based on confidential information that someone is party to. This is often referred to as ‘insider dealing’ and is covered by the Market Abuse Directive. Whilst we may not deal in investments directly there may be occasions through the course of our business where a staff member may become party to confidential information.
Where this is the case, nobody within our firm (or third party outsourced partners) will:
a) Enter into a personal transaction which meets at least one of the following criteria:
- That person is prohibited from entering into it under the Market Abuse Directive
- It involves the misuse or improper disclosure of that confidential information
- It conflicts or is likely to conflict with an obligation of our firm to a client under the regulatory system
b) Advise or procure, other than in the proper course of employment or contract for services, any other person to enter into a transaction in designated investments which, if a personal transaction of the relevant person, would be covered by (a)
c) Disclose, other than in the normal course of employment or contract for services, any information or opinion to any other person if the relevant person knows, or reasonably ought to know, that as a result of that disclosure that other person will or would be likely to take either of the following steps:
- To enter into a transaction in designated investments which, if a personal transaction of the relevant person, would be covered by (a)
- To advise or procure another person to enter into such a transaction
Failure to disclose transactions when required to do so by this policy will be in breach of the FCA’s conduct rule ‘You must act with integrity’.
Personal account dealing process
The following procedures have been implemented to assist in reducing the risks associated in this area:
a) Any such situations identified, must immediately be notified to the Compliance Manager.
b) We will ensure that all staff are aware of our personal account dealing procedures and of any restrictions. Typically, this is done by asking staff to sign an annual staff declaration.
c) We will ensure that any third-party outsourcer our firm uses that carries on activities that might give rise to a conflict of interest, for example discretionary portfolio manager, has appropriate policies in place in relation to personal account dealing. Confirmation of this will be obtained in writing at the outset of any business relationship.
d) Any business conducted by a member of staff, on their own account, will be recorded on a personal account dealing register. This will exclude the following types of business:
- Personal transactions undertaken through a discretionary management service where there’s no prior communication between the investment manager and the person for whom the transaction is being effected.
- Personal transactions in units or shares in collective investment schemes.
- Personal transactions in life policies. This includes pension policies, investment bonds, and long-term care insurance contracts.