The Central Bank’s Strategic Plan 2013 – 2015 sets out a strategy of assertive risk-based supervision underpinned by a credible threat of enforcement. Enforcement is an important tool to effect deterrence, achieve compliance and promote positive behaviour. The Central Bank will take enforcement action against regulated entities under its Probability Risk Impact Supervisory System (PRISM) supervisory model. PRISM represents a challenging and proportionate risk-based system of supervision for all financial institutions operating in Ireland. During 2012, the Central Bank entered into 16 settlement agreements. The sanctions imposed included 16 fines, totalling €8.5m, and 16 reprimands. The Central Bank took a total of 841 regulatory actions in 2012, an increase from 494 in 2011. A detailed breakdown of regulatory actions for 2011 and 2012 can be found on the Central Bank’s Annual Performance Statement (Financial Regulation) 2012-2013 which is available on the Central Bank website.
I am advised by the Central Bank that for legal reasons, including the Bank’s confidentiality obligations pursuant to section 33AK of the Central Bank Act 1942, no details on the number or nature of cases being presently taken by the Enforcement Division can be disclosed.
I would like to point out that the recently-enacted Central Bank (Supervision and Enforcement) Act 2013 enhances the powers of the Central Bank in a number of important respects:
- Customer redress for problems that are widespread or regular, such as overcharging or systems failures;
- Debt management: a regulatory regime for debt management and debt advice;
- Whistleblower protections;
- Central Bank regulation-making powers on a range of conduct of business areas, including consumer protection;
- Enforcement: this includes restitution orders and the recoupment of investigation costs from those found guilty of an offence;
- A doubling of the maximum administrative sanction to €1m for an individual and €10 million for a firm;
- Enhanced powers of inspection, investigation and information gathering for Central Bank authorised officers;
- Auditor assurance: Central Bank power to require an auditor to provide a written report on compliance by a financial service provider with certain requirements.
Question No. 166 answered with Question No. 121.