Statement of Principles on the Use of Enforcement Powers

Summary

This is a Bermuda Monetary Authority (BMA) Statement of Principles explaining how the Authority will use its enforcement powers under the Insurance Act 1978, Banks and Deposit Companies Act 1999, Investment Business Act 2003 and Trusts (Regulation of Trust Business) Act 2001 (with similar powers anticipated for the Investment Funds Act 2006 and applied under the Corporate Service Provider Act). It is an explanatory policy document about the BMA's own decision-making and enforcement process rather than a set of new compliance rules for firms.

• Scope: Covers the initial supervisory approach to compliance issues, the decision-making process (delegated to the CEO with input from an Enforcement Unit and Enforcement Committee), and the factors influencing whether and how enforcement action is taken.
• Enforcement options: Lists available tools: directions, restrictions and conditions on a licence; civil penalties (up to $5,000 per week for late statutory filings, or up to $500,000 per breach of an obligation); injunctions; public censure; objections to controllers; prohibition orders against directors/officers; licence revocation; winding up; and referral to police.
• Publicity: Sets out criteria the Authority will weigh in deciding whether to publish details of a Decision Notice, including deterrence, stakeholder protection and proportionality.
• Appeals: Identifies which enforcement actions (e.g. licence revocation, civil penalties, public censure, prohibition orders, conditions/restrictions) carry a right of appeal to a Tribunal, and confirms that BMA decisions remain effective unless a Tribunal orders a stay.

The document does not itself create new filing deadlines or compliance duties for licensees; it describes the Authority's discretionary framework for escalating and resolving breaches of existing regulatory obligations under the relevant Acts.

Applies to

banks, deposit companies, insurers, investment business licensees, trust service providers, corporate service providers