Statement of Principles - Money Service Business Act 2016

Summary

This is the Bermuda Monetary Authority's Statement of Principles under section 6 of the Money Service Business Act 2016. It explains how the Authority interprets the minimum licensing criteria in Schedule 1 to the Act, the grounds for revocation, and how it exercises its powers to grant, revoke or restrict licences and to obtain information from Money Service Businesses (MSBs).

• Fit and proper standard: Sets out how the Authority assesses whether controllers and officers of an MSB are fit and proper, including competence, soundness of judgment, diligence and probity.
• Shareholder controllers: Explains the factors considered for shareholder and indirect controllers, including influence over the MSB and risk of reputational or financial contagion.
• Prudent conduct of business: Describes the Authority's expectations for governance, risk management, AML/CFT controls, suitable premises, compliance with foreign laws and sanctions, and maintenance of adequate insurance cover.
• Accounting and record-keeping: Covers expectations for adequate accounting systems and record-keeping as part of the minimum licensing criteria.
• Corporate governance and consolidated supervision: Addresses governance arrangements and, where relevant, group-wide consolidated supervision considerations.
• Information and enforcement powers: Describes the Authority's statutory powers under sections 49, 50 and 51 of the Act to require information, reports and documents, and to enter business premises, and notes the certificate of compliance required under section 57.

The Principles are intended to be read alongside the Authority's Guidance Notes and the Statement of Principles on the Use of Enforcement Powers (SPUEP), and may be revised over time as the MSB sector develops.

Key obligations

• MSBs must alert the Authority forthwith when they become aware of breaches or potential breaches of the minimum licensing criteria
• MSBs must alert the Authority to any proposed material change in their business
• MSBs must notify the Authority immediately if they become aware of material concerns regarding the suitability of a shareholder controller
• MSBs must maintain insurance cover appropriate to the nature and scale of their operations to be regarded as conducting business prudently
• MSBs must have policies and procedures to comply with international sanctions in force in Bermuda
• MSBs must submit a certificate of compliance, signed by an officer, certifying compliance with the minimum criteria under section 57 of the Act
• MSBs must provide information, reports and documents to the Authority when required by notice under sections 49 and 50 of the Act, and permit entry to business premises under section 51

Applies to

Money Service Businesses (MSBs), controllers, officers, shareholder controllers

Deadlines

• forthwith: MSBs must alert the Authority forthwith upon becoming aware of breaches or potential breaches of the minimum criteria
• immediately: MSBs must notify the Authority immediately of material concerns regarding the suitability of a shareholder controller