Cabinet approves Bill to improve responsibility in financial firms
The Cabinet has approved a Bill on the responsibility for conduct, for those working in the financial services sector.
This Central Bank Bill sets out rules where employees in banks and investment funds will have to comply.
It is expected to take four to six months to pass into legislation and once this has been completed, the Central Bank will implement it into its regulatory work.
The new Individual Accountability Framework also aims to be up and running within the next 18 months.
What will this new legislation mean?
This new legislation will broaden out the scope of the Senior Executive Accountability Regime (SEAR). It will now include a wider range of staff who are involved in different roles with customers, including the more senior positions.
The Minister for Finance Paschal Donohoe said that “The provisions will ensure that there is clarity around the roles and functions of senior executives”.
The Bill will also mean that individuals can be held accountable for breaking market rules, without the Central Bank having to assess whether their firm is also at fault.
When this has been established, sanctions will include fines and disbarment from future employment within the financial sector.
Who will this benefit?
This new legislation aims to ensure that customers benefit from financial service providers that are fully accountable for the service and advice they provide.
Employees of financial institutions will also benefit from having clear guidance as to their exact roles and responsibilities.
As well as this, the framework will reassure and empower employees to speak up when they see failings.
“Ultimately a key challenge will be the rebuilding of trust in the financial sector,” the Minister said.
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