Committee wants bad bankers jailed for 10 years
THE JOINT select committee of Parliament which considered the Banking Services Act has recommended that certain breaches of the legislation be tried by a Supreme Court judge sitting alone.
The committee, in its report tabled in the House last Wednesday, further said that for trial in the Supreme Court, there should be no preliminary enquiry or committal proceedings.
In addition, the committee wants any offence that should be tried in a resident magistrate's court to be tried by a judge alone in the Supreme Court, in a case where there are any other charges arising out of the same facts and those other charges are indictable offences which can be tried in the Supreme Court.
Under the proposed Banking Services Act, a person who fraudulently misrepresents himself to be licensed or authorised to engage in business or activities on behalf of deposit-taking institutions, faces up to two years in jail, and/or a fine of not more than $3 million if the conviction takes place in a resident magistrate's court.
If, however, the conviction is in the Supreme Court, persons face a fine and a term of imprisonment of up to 10 years.
The new legislation seeks to amend and consolidate the existing Banking Act, Financial Institutions Act and the prudential regulation provisions of the Building Societies Act into one governing act.
It also seeks to enhance the powers of the Bank of Jamaica (BOJ) as chief police of the financial system with a range of penalties for breaches, including a three-year imprisonment for unlawfully disclosing information regarding the operations of any licensee or the affairs of a customer of a deposit-taking institution or a foreign bank.
The joint select committee, which considered the 170-page bill, held three meetings as well as a three-day residential weekend retreat to discuss its contents.
It received submissions from the Jamaica Bankers' Association, Building Societies Associations of Jamaica, and Institute of Chartered Accountants of Jamaica.
The Banking Services Act is a requirement under Jamaica's four-year extended fund facility arrangement with the International Monetary Fund (IMF).
Its purpose, as outlined in Jamaica's updated Letter of Intent to the IMF, relates to mitigation of risks inherent in Jamaica's highly interconnected financial system; harmonise the prudential standards across banking institutions; consolidate supervision of financial conglomerates; strengthen regulatory sanctions; and provide the BOJ with operational independence to supervise the system.
If approved by Parliament, the finance minister will be stripped of the responsibility of appointing the governor of the BOJ and will also lose the power of having direct responsibility for the monitoring of banks and other regulated financial institutions on the island.
The bill provides for the BOJ governor to now get the power to grant or revoke licences to deposit-taking institutions, and would bring the BOJ in line with the Financial Services Commission, which is empowered to grant and revoke licences for the institutions it supervises.
The bill proposes that the BOJ Act be amended to allow for the governor to be appointed by the governor general for a period not less than seven years.
Among the aims of the proposed bill is to improve governance and transparency of the processes.
It incorporates new offences such as illegal deposit-taking, fraudulent misrepresentation to obtain a licences, and operating or offering deposit-taking services to persons resident in Jamaica without being licensed.