The Channel Islands Stock Exchange (CISX) has suspended all new listings due to the ongoing investigation by the Guernsey Financial Services Commission for alleged historic activities.
The investigation, which has been ongoing for 20 months, has highlighted defects in the complex and unusual structure of the CISX and was asked to deal with those historic issues and develop a better structured and regulated new corporate vehicle.
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Chairman John Moulton said that the investigation was related to historic activities rather than current matters.
Moulton added that all the other functions at the stock exchange will continue as normal.
The GFSC will work alongside CISX towards the proposals to design a better structure, which are expected to be available in a month.
News of the suspension follows the resignation of its founder and chief executive, Tamara Menteshvili last month, which has incurred significant costs and as a result of this a profit is not expected this year.
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By GlobalDataThe move to suspend listings and not to admit new members could be affected and rendered unduly complex by a change in the Exchange’s structure.
Moulton said: "These investigations are ongoing, detailed ridings have not been received by the Board [of the CISX] and consequently the Board cannot estimate with any confidence their final completion timescale or any effects upon the companies’ business model.
"The CISX has recently made provisions for around GBP500, 000 in respect of costs to date and possible regulatory settlements although no liability for such is currently admitted."
The exchange, which was established in 1998 has taken 510 new listings in 2012 and reached 5,000 in total in April.
