Knowledge

Introduction

The decision in Neneb Pte. Ltd v HSBC Management (Guernsey) Limited and HSBC (Guernsey) GP PCC Limited (Royal Court of Guernsey, 21 October 2026) reinforces the evidence-based approach that the Royal Court of Guernsey (the "Court") will take in respect of questions over the provenance of assets in "no consent" proceedings.

The case – in which Bedell Cristin's Guernsey Litigation team secured a successful outcome for its client – focused on investments held through private equity structures administered in Guernsey, in respect of which a Suspicious Activity Report ("SAR") was submitted in 2016.

Distributions were subsequently withheld following the refusal of consent to make payments under Guernsey's "no consent" regime.

Following a trial in September 2026, the Court gave an immediate decision in our client's favour, declaring that the investments did not constitute, nor represent, the proceeds of criminal conduct.

The Court ordered the release of distributions due to our client and directed that future distributions be paid in accordance with the parties' agreed investment terms.

The facts

The SAR filed in 2016 was based principally on historic adverse media reports concerning the source of wealth of the ultimate beneficial owner of the investments.

The allegations focused on a significant bank share purchase transaction dating back to 1991 and, more broadly, on the beneficial owners combined wealth accumulated through numerous business activities in Mexico spanning several decades to the early 1970s.

Our client sought the release of the funds by way of an application to the Court.

The sole issue before the Court was provenance: whether the claimant could establish, on the balance of probabilities, that the investment did not constitute, and did not represent, the proceeds of criminal conduct.

The issues

A key issue before the Court was the extent to which a claimant must establish the provenance of assets where the relevant transactions occurred several decades earlier, the claimant's wealth had been accumulated over many years, and complete documentary records were no longer available.

The case therefore required the Court to consider the approach that should be adopted when assessing historic wealth generation on an international scale, the significance of regulatory scrutiny of underlying transactions, expert tracing evidence, and the practical realities of proving the origins of funds many years after the relevant events.

In considering those issues, the Court examined:

• the acquisition and subsequent sale of a substantial banking investment;
• the traceability of the proceeds from that sale into the investments before the Court;
• the significance of extensive regulatory scrutiny of historic transactions;
• expert forensic accounting evidence; and
• the practical realities of proving the origins of wealth many years after the underlying events occurred.

Establishing provenance

Our client's case relied upon a substantial body of documentary, witness and expert evidence demonstrating a legitimate source of wealth, the acquisition and subsequent sale of a significant banking investment, and the traceable movement of funds into the investments that were ultimately the subject of the proceedings.

The Court heard expert forensic accounting evidence, which concluded that there was sufficient legitimate wealth available to fund the original acquisition and identified no evidence of illicit funds entering the investment chain.

The expert evidence further traced the proceeds of the underlying investment through subsequent accounts and into the assets before the Court.

The Court also placed significant weight on the fact that the acquisition and subsequent disposal of the banking investment had been subject to substantial regulatory scrutiny and approval, including review by the United States Federal Reserve Board.

The outcome

The Court declared that the investments did not constitute and did not represent the proceeds of criminal conduct. It ordered the release of distributions due to our client and directed that future distributions be paid in accordance with the parties' agreed investment arrangements.

The judgment brings to an end a matter that had remained unresolved for approximately a decade and provides welcome certainty regarding the status of the investments and future distributions.

Key points

The case is a notable example of the Court's approach to provenance disputes arising from long-standing SARs.

It reinforces that the relevant question is whether the evidence establishes a practical connection between the assets in question and criminal proceeds, rather than whether historic allegations or adverse media reports exist.

Importantly, the Court recognised the practical difficulties faced by claimants seeking to establish the provenance of wealth generated many years earlier, noting that records may have been lost or destroyed through the passage of time and that it would be unrealistic to expect every historic transaction to be evidenced decades later.

The Court's decision demonstrates the importance of adopting a practical and evidence-based approach, balancing contemporaneous documents, tracing evidence, regulatory history and witness testimony, when considering provenance in such circumstances.

We are delighted to have achieved this successful outcome for our client and to have assisted in securing the release of assets that had been subject to a lengthy freeze.